China has a major role to play to enable Nigeria achieve its aim of building a $5.8 billion hydro-power plant in the eastern Mambila region of Plateau state this year.
Power, Works and Housing Minister, Babatunde Fashola, who stated this in an interview in Abuja last Friday, enthused, “We hope to break new ground this year if we can conclude the financing deal with China’s Export-Import Bank. Contracts are in place. We are good to go.”
Mr. Fashola told reporters that the Chinese would finance 85 percent of the cost, while the Nigerian government would provide the rest. China Civil Engineering Corporation will build the 3,050-megawatt power plant over five years, and the facility will include four dams measuring 50 meters (164 feet) to 150 meters high, and 700 kilometers (435 miles) of transmission lines.
The government expects power-production capacity to increase to 8,600 megawatts in a year from 7,000 megawatts currently, Mr. Fashola said. In comparison, South Africa, with a third of Nigeria’s population, has an electricity-generating capacity of more than 40,000 megawatts.
Nigeria also plans to improve distribution capacity, currently at about 5,000 megawatts. Since the country is able to produce more electricity than it can distribute, some production capacity will remain idle until the government expands the network. The government wants to partner with private companies to invest in mini-grid projects and generate an additional 3,000 megawatts of electricity over five years. Mr. Fashola said some investors had already shown interest without providing further details.
According to the Minister, some planned solar power projects have failed to secure funding and should be reassessed. He disclosed that the Nigeria Bulk Electricity Trading Plc signed preliminary power-purchase agreements in 2016 with private companies for 14 solar projects meant to generate 1,125 megawatts of electricity, but there have been issues over payment-related guarantees.
As the Minister pointed out, these should be redesigned to sell electricity not only to the government via the national grid but to customers in remote areas directly. “They should rethink their models and begin to look at estates and communities,” he said. The government is also working on regulations to license suppliers of electricity meters to stop some distribution companies from billing consumers arbitrarily, Mr. Fashola said. He declared emphatically, “We want to open the meter market because the core business of a distributor is not metering but distribution of energy.”
