*Complete delivery of entire projects expected by Q2, 2024
By Emeka Ugwuanyi
The Central Bank of Nigeria’s (CBN’s) N122.3 billion intervention fund in the power sector has helped in resolving some of the bottlenecks in the transmission and distribution arms of the power value chain, which have been impeding maximum utilization of electricity generated by generation companies (GenCos).
The intervention was targeted at resolving the transmission and distribution interface bottlenecks to improve supply to end users and unlock the unutilized generation capacity in the country.
Out of the N122.3 billion intervention facility issued at single digit interest rate of 9 per cent, N85.4 billion has been disbursed to the 53 contractors handling the projects and 80 percent of the jobs have been completed. The entire projects under the intervention are expected to be completed by second quarter of 2024.
The CBN intervention is anchored on firm Service Level Agreements (SLAs) between the Transmission Company of Nigeria (TCN) and electricity distribution companies (DisCos) on the one hand and DisCos and their customers on the other hand. The facility was given to DisCos to invest in TCN networks by virtue of NERC regulation that permits third party investment in the electricity network. Payment for the loan would be a net off from the TCN monthly invoice to DisCos. The project implementation Office (PMO) is resident in TCN for effective implementation.
Projects are presently implemented through the Project Management Office (PMO) at TCN headquarters in collaboration with both TCN field engineers and DisCos technical team. The completion time of the projects is May 2024 latest. PMO has made progress with the implementation of the programme, despite challenges encountered and is committed to ensure the successful implementation of the programme.
Manufacturing process for most of the contracts is scheduled to be completed early next year 2024 to pave way for shipment and delivery. However, seven contractors have finished with offshore production process, they are: Skipper Nigeria Limited for BEDC; GTA Engineering Nigeria Limited (PHEDC); T&D West Africa Limited (IKEDC); Lagacee Power Limited (AEDC); Bussdor & Company Limited (AEDC); Fosab Global Energy Services Limited (PHEDC); and Beam Energy Limited (EKEDP).
According to a document obtained by The Business Intelligence Africa (TBI Africa), the details of project are – 8 nos. of 150MVA transformers giving a total of 1,200MVA; 19 nos. of 100MVA transformers giving a total of 1,900MVA; 27 nos. of 60MVA transformers giving a total of 1620MVA; re-conductoring existing transmission lines (conductors & accessories) in 3 areas with a total length of 517.5km; 24 nos. of existing 132/33KV substations to be upgraded; and 50 nos. of 33KV line bays to be constructed.
For the sake of transparency and to prove to Nigerians that the projects are ongoing contrary to speculations that they have been abandoned, the Transmission Company of Nigeria (TCN) on Wednesday took stakeholders on facility tour of some of the projects being carried out under the CBN power intervention programme in Lagos. The facilities visited include the Isolo transmission substation, TCN stores in Ojo, and Oworonsoki transmission station. The 1×30 MVA transformers previously at these transmission stations are being replaced with I×60 MVA power transformers.
The Programme Manager, TCN, Mr Matthew Ajibade, told stakeholders during the facility tour that over 80 per cent of the projects captured under the intervention programme have been completed and has resulted in improved electricity supply.
The facilities and inspection tour were jointly done by top management members of staff of CBN, Eko Electricity Distribution Company (EKEDC), Ikeja Electric and TCN.
Ajibade stated that 53 contracts were approved by the CBN in August 2022 for the entire electricity distribution companies (DisCos) in Nigeria and the total intervention fund is N122,289,344,369.39.
“These projects were identified by the stakeholders to address the transmission and distribution bottleneck in order to allow seamless evacuation of power from generation to distribution networks.
“So, the projects were conceived about two years back through open competitive procurement process that led to the award of 53 contracts to different contractors.
“We are here today for the inspection of those projects and consignments that have already arrived in some selected sites. We plan to deliver this project before the set deadline date.
“The projects are in two categories, some are supply contracts and we have others that are engineering, procurement and construction (EPC).
“So far, 80 per cent of the projects have been completed and we are sure that by May, 2024, we will have completed all the projects here in Lagos,” Ajibade said.
Ajibade further stated that the reason for the inspection was to show the whole world that the project are not abandoned as thought. We have done several factory inspection visits to test some of those transformers that have arrived. We are here today to inspect them.
“The objective of this intervention is to address all these bottlenecks between transmission and distribution and at the same time, to enhance the social economy activities of the country.
“CBN intervention is naira denominated and all the contractors are all local contractors. They are all registered in Nigeria,” he said.
He stated that the expected impact of the projects is to add 1,500 megawatts (MW) of distributable electricity to the system at the end of the programme. However, the impacts of this intervention will differ from one DisCo to the other, Ajibade added.
“We are expecting a great improvement in nation’s power sector as there will be adequate capacity available for the DisCos to wheel power to their network from the transmission network,” he said.
Commenting, the Assistant Director and Head, Infrastructure Finance Office, CBN, Mr. Tumba AbdulRazaq Tijani, said he was impressed with the level of works carried out on the projects. Most of sites we visited were only disbursed funds to precisely in August2022, he added.
“In Isolo Transmission Station, we could see that the job is over 70 per cent completed, just awaiting the equipment from TCN for installation.
“In Ojo station, we can also see 100 per cent achievement. The two transformers being requested for with accessories all have been supplied, the only one left will be deployed to another site,” he said.
Tumba noted that the purpose of the projects was to alleviate the blackout and other critical economic issues within the country, which we are all facing.
“The projects are timely and when completed, millions of Nigerians across the nation would benefit from not only the electricity but locals would be indirectly employed as a result of the improved power supply.
“It will also boost economic activities, as there’ll be more cash in the system going round, and there’ll also be more manufacturing tools being produced within the country.
“As you can see most of these equipment are being done locally except the heavy ones, which wouldn’t have the components here in Nigeria. About 90 per cent of the components for these projects are produced locally.
“CBN envisaged this and the outcome, that is why we keyed into it, to support the nation economically so that we will be vibrant to ensure we address every issues in the country.
“Without power, most of what we are crying for today will not come to reality. Power is the bedrock of the economy, and certainly were delighted to see the way the contractors are going on with this job,” he said.
The inspection tour will be a regular occurrence subsequently as the project implementation advances, inspection team said.
