Nigeria’s electricity export crashed by $58.1m in one year amid grid collapse, Brand Spur Nigeria gathered.
Data from the Central Bank of Nigeria (CBN) showed that the value of Nigeria’s electricity export was $213.66m in 2021 but dropped to $155.56m in 2022. This represents a 27 per cent drop in earnings from crude oil exports.
It also means Nigeria made $369.22m in two years from exporting its electricity.
In August last year, the Managing Director of TCN, Sule Abdulaziz, noted that Nigeria has been exporting electricity, and this provides an avenue to earn more foreign exchange for national development.
He said, “Nigeria, through TCN, had been exporting electricity to Niger, Benin, and Togo under a country-to-country arrangement.”
However, Nigeria consistently suffered the collapse of its national grid, which further affected electricity output in 2022.
The PUNCH reported last year that Nigeria’s available power generation capacity fell by 981.8 megawatts between 2015 and August 2022 despite the over N1.51tn intervention in the sector by the Federal Government since the current administration came on board in 2015.
This came as the national grid collapsed 98 times under the administration of the former President, Muhammadu Buhari.
A document on Power Generation Trend (2013 – August 2022), obtained in Abuja from the Association of Power Generation Companies, the umbrella body of electricity producers, indicated that while available power generation capacity was 6,616.28MW in 2015, it dropped to 5,634.47MW as of August last year.
It was also gathered that the total power generation capacity loss for the sector between 2015 and August 2022 rose to N1.76tn, as operators and experts decried the sorry state of the industry since it was unbundled in November 2013.
Although further analysis of the document showed that the available generation capacity fluctuated between 2015 and 2022, data from the report indicated that the quantum of available generation in Nigeria was not impressive, particularly since 2021.
It must be noted that the available generation capacity is different from the average utilised generation, as the latter is constantly lower than the former.
In fact, data from the document indicated that Nigeria’s average utilised generation during the review period hovered between 3,600MW and 4,118MW, which were, of course, lower than the least available generation capacity of 5,634.47MW recorded between January and August 2021.
The available generation capacities in 2015, 2016, 2017, and 2018 were 6,616.28MW, 7,039.96MW, 6,871.26MW, and 7,506.23MW, respectively.
For 2019, 2020, 2021, and 2022 (January – August), the available power generation capacities of electricity producers across the country were 7,381.67MW, 7,792.51MW, 6,336.52MW, and 5,634.47MW, respectively.
On the annual capacity payment loss in the sector, the report indicated that in 2015, 2016, 2017, and 2018, the industry’s losses were N214.93bn, N273.32bn, N236.47bn and N264.08bn, respectively.
In 2019, 2020, 2021, and 2022 (January – August), the sector’s annual capacity payment losses were N256.97bn, N266.10bn, N159.86bn, and N88.13bn, respectively.
The above figures, therefore, showed that despite the interventions by the Federal Government in the power sector, estimated at over N1.51tn, available generation capacity did not appreciate much, rather, it had been decreasing since 2021.
The Federal Government, aside from its annual budgetary allocations to the Federal Ministry of Power, undertook a series of interventions in the power sector in a bid to revamp the industry.
This, however, was despite the fact that the distribution and generation arms of the business were unbundled and officially sold to private investors in November 2013.
On September 30, 2014, the Federal Government announced a loan of N213bn to the privatised power firms.
On March 1, 2017, the Federal Government approved the sum of N701bn as a power assurance guarantee fund for the Nigerian Bulk Electricity Trading Plc to pay for the electricity produced by the generation companies for the period of two years.
It provided the fund to tackle the monthly liquidity challenges faced by generation companies, following the inability of power distributors to adequately meet their obligations in terms of remittances to the sector.
The government also provided the sector another N600bn payment assurance facility in 2019. The fund was secured from the Central Bank of Nigeria.
Aside from these direct interventions from the Federal Government, the sector has also received funding from international financiers such as the World Bank, and African Development Bank, among other development partners.
Despite the interventions, the country’s power grid had recorded incessant partial and total collapses.
There was a grid collapse on September 25, 2022, when power generation on the system crashed from over 3,700MW to as low as 38MW.
On July 20, 2022, Nigeria’s power grid saw the sixth collapse in 2022, while on June 13, The PUNCH reported a grid collapse. The nation’s power system collapsed twice in March and twice again in April this year.
