CBN’s $250m Funding: Stakeholders Expect Electricity Transmission, Distribution To Improve

Stakeholders are expecting improvement in electricity transmission and distribution as companies embark on projects funded by a $250 million intervention of the Central Bank of Nigeria (CBN).

The fund meant to urgently fix existing dilapidated infrastructure in the area of electricity distribution and transmission would enable the Transmission Company of Nigeria (TCN) wheel more electricity on the short and enable distribution companies (DisCo) procure and repair their key interface infrastructure.

Although existing challenges, especially unsettled management issues have hindered some DisCos from accessing the fund, there are indications that some DisCos have ordered thousands of transformers, as some of the utility companies have been provided about N6 billion under the initiative.

Most stakeholders noted that the development that funding would offer consumers value for money which they are made to pay under the Service Based Tariff and improve the liquidity crisis in the power sect while addressing the menace of stranded electricity.

Energy Finance Expert, Dan Kunle noted that financing improvement in the transmission and distribution segment of the electricity market is sacrosanct.

RELATED

Despite 50% Tariff Hike, Internet Usage Hits 1m TB In May

11 hours ago

Interim Dividend: Stocks Gain N377bn In 1 Week

11 hours ago

Stating that the funding by the CBN is on the right path, Kunle noted that improving the manufacturing sector to perform better on the backdrop of improved electricity remained critical.

Speaking on the matter recently, the minister of Power, Abubakar Aliyu stated that the apex bank was already funding a $250 million project to ensure the rehabilitation of critical interfaces infrastructure between both segments to increase and stabilise power delivery.

This according to him, is in addition to the Siemens Presidential Power Initiative (PPI) that will bring in additional $2.0 billion or more to the transmission grid from the government.

With the critical intervention, the minister said government was expending  almost $4 billion secured by the current administration to augment the grid, adding that much of the funds were being actively spent and the results will be felt soon.

According to him, the interface projects along others already being embarked upon by TCN brings ongoing projects in the transmission segment alone to 135 ongoing projects with 30 completed key substation projects and 12 transmission lines.

Also speaking on the issue,  Market Operator (MO) at TCN, Edward Eje said the interface project was aimed at providing quick solutions at various transmission/distribution interfaces where there are challenges.

“This makes sense to me. It is a laudable measure to achieve a seamless and a hitch-free power transmission from the transmission stations to the distribution network,” said.

Eje’s position also aligned with the comments by the managing director and chief executive officer of Nigerian Bulk Electricity Trading Company, (NBET) Dr. Nnaemeka Ewelukwa.

Ewelukwa disclosed that the apex bank was able to identify critical projects that could quickly address and restore normalcy to the sector in the near term.