December 12, (THEWILL) – The Federal Government has hinted at plans to restructure the Transmission Company of Nigeria (TCN), into two entities.
Minister of Power, Adebayo Adelabu, disclosed this while speaking at the Federal Ministry of Power ministerial retreat, held in Abuja, on Tuesday.
The TCN, which coordinates the nation’s electricity transmission network, is one of 18 companies that were unbundled from the defunct Power Holding Company of Nigeria (PHCN), in April 2004. It was incorporated in November 2005 and issued a transmission licence a year later.
TCN’s licensed activities include electricity transmission, system operation and electricity trading. The company is currently fully owned and operated by the government.
Speaking on Tuesday, Adelabu, said the Nigerian Electricity Supply Industry (NESI), transmission sub-sector has been identified as a critical weak point in the electricity value chain.
He said TCN would be restructured to become the Independent System Operator (ISO) and the Transmission Service Provider (TSP).
Adelabu explained that the restructuring must synchronise with the evolving landscape of State Electricity Markets, addressing calls for the decentralisation of the national grid into regional grids interconnected by a new higher voltage national or super-grid.
The Minister noted that the goals of the reforms introduced by the government to improve power supply have largely remained unmet.
“One of the main objectives of the Nigerian electricity sector reform programme initiated over 23 years ago is to make electricity available to consumers across the country with efficiency and consistency, which in turn lead to general reliability and affordability.
“Even as electricity consumption per capita was at 140 KWh in 2021, relatively low in comparison to neighbouring countries and almost three times lower than the average for Sub-Saharan Africa, Nigeria is a case study in a deep electricity paradox.
“Nigeria has grown to become the host of probably the world’s largest fleet of diesel-and petrol-powered generation capacity that is utilised for base load supply.
“Various figures have been mentioned but it is safe to say that this fleet measures no less than 40,000 MW of total capacity. At an average operating cost of no less than N250 kWh as opposed to an average economic tariff today of approximately N120 kWh (weighted between petrol and diesel generation), the daily cost of this extreme inefficiency in electricity supply in Nigeria is measurable in tens of billions of Naira daily.
“This is hard-earned money that would better be deployed to savings, discretionary consumer spending and tax revenue for governments instead of being burnt and going up in diesel and petrol emissions that harm our environment and contribute to incessant noise pollution in many of Nigeria’s cities”, he said.
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