Nigeria the economic and power sector reform program african. This study seeks to examine the power sector reforms, effects on electric power supply reliability and stability in nigeria. The ministry in discharging this mandate is guided by the provisions of the national electric power policy nepp of 2001, the electric power sector reform epsr act of 2005, and the roadmap for. The impact of the energizing economies initiative in ariaria market, abia state. Electricity generation and the present challenges in the. The government aimed to improve the macroeconomic environment within nigeria and to better manage public expenditures. The electric power sector reforms act epsra this is the primary law that sets up the regulatory framework for the entire electricity sector. However, in august 2010 the then president, goodluck jonathan, launched the power sector reform roadmap, aimed at shifting the running of power utilities to the private sector.
The power sector recovery program focuses on supporting implementation of power sector reform, reducing losses in the distribution companies, enhancing the sector s financial viability, increasing access to electricity services, and mobilizing private sector investment. The federal government of nigeria launched a farreaching set of power sector reforms in 2001 that led to the unbundling and subsequent privatisation of electricity generation and distribution. The nepp was encoded in legislation through the electric power sector reform act 2005. Fgn power reform agenda fgs reform of power sector is gingered mainly by the need to reduce the cost of doing business in nigeria in order to attract new investment through provision of quality and dependable power supply to the economy for industrial, commercial and sociodomestic activities. The objectives of this study are, to assess the implications of banking sector reforms and identify the challenges in order to proffer solutions to the banks to achieve optimum performance. This utility was charged with the responsibility for the generation, transmission, distribution and sale of electricity to customers. It included the privatisation of the stateowned power holding company of nigeria phcn. With the epsr act, nigerian power sector reform achieved institutionalisation.
World bank group support for nigerias power sector. These pieces of legislation included the constitution of the federal republic of nigeria. Plot 590b, lekan asuni close, omole phase ii, isheri lga. Written a few years before the privatization of national electric power authority nepa, this paper allows one to revisit and understand the challenges that the power sector faced at the time and why privatization was necessary. It goes on to explore in what ways, if any, the provisions therein would require reform in the public sector. Pdf an assessment of the power sector reform in nigeria. Broadly, the challenge with effective and efficient electricity supply in the postprivatized electricity market in nigeria can be summarised in. Economic reforms was first introduced in nigeria in 2003, during the second term of president olusegun obasanjo. Political economy of nigerian power sector reform unuwider. Why nigerias power privatisation hasnt achieved full. The challenges of the nigerian electric power sector reform 1 the challenges of the nigerian electric power sector reform 1.
By 2020, the energy sector will be the major engine of. The president in his speech delivered on august 26. Txt the text version is uncorrected ocr text and is included solely to benefit users with slow connectivity. Federal republic of nigeria federal ministry of power. Electric power sector reform act 2004 laws of nigeria. This instrumental act revolutionized the sector, bringing into existence the current independence and private status of the generation and distribution chains in the nigerian power sector. Responsibility act 2007, being a major framework for carrying out the public sector reforms in nigeria, are examined in order to determine their compatibility, or otherwise, with the public sector budgeting and accounting systems.
The federal government of nigeria using national council on privatisation ncp in 1998 had therefore, embarked on an electric power sector reform program. Proshare is nigeria s premier financial, business and economic information hub since 2006 registered office. With an installed generating capacity of about 7,500mw and operating capacity of. The historically low level of investment in nigeria s power sector has been a significant barrier to private investment in the country10. Privatisation in the power sector navigating the transition. Overcoming postprivatization challenges by 2020, the energy sector will be the major engine of the nations sustainable social, economic and industrial growth, delivering affordable and constant energy supply efficiently to other sectors of the economy nigeria s vision 2020 national technical.
As of 2012, nigeria generated approximately 4,000 5,000 megawatts of power for a population of 150 million people as compared with africas second largest economy, south africa, which generated 40,000 megawatts. This paper therefore critically assessed the proposed reform of the electricity market in nigeria. There is no doubt that there is high level of inefficiency in the nigerian power sector. The prsp is focused on implementing power sector reforms in nigeria. The political economy of nigerias power sector reforms. Complementary policies, planning, funding, and purposebuilt agencies for electrification all contribute to give direction to power sector reforms, helping countries to. An overview of power sector laws, policies and reforms in. Hence, the national electric power policy of 2001 kicked off the power sector reform in nigeria, leading to several other reforms over the last decade. The nigerian power sector is primarily responsible for generating. In 2001, the federal government of nigeria launched a farreaching set of power sector reforms which ultimately led to the unbundling and privatisation of electricity generation and distribution companies in 20.
The reform program was known as the national economic empowerment and development strategy. Nigerian power sector is there light at the end of the. Embedded generators are usually connected to the medium or low voltage grid. The partial risk guarantee program in support of the power sector privatization aims to increase electricity generation in nigeria by catalysing private sector investment and commercial financing in nigeria s power sector through the provision of partial risk guarantees prgs. Nigeria the economic and power sector reform program. The nigerian power sector reform was aimed at improving the stability of electricity supply, improving cost recovery, and increasing the availability of investment capital. At present, less than half of nigeria s population has access to gridconnected electricity. We have proposed that there should be a coordinating body for all those agencies in government responsible for power sector reform, which should be in constant dialogue with the key private sector. The nigerian power sector reform has created more opportunities for investors attributable to the increasing demand for sufficient supply of meters, transformers, cables, transmission towers and other generation, transmission and distribution facilities. Since the advent of the democratic regime in nigeria, there have been significant strides in the reform of the sector. The challenges of the nigerian electric power sector.
Nigeria, political economy, power sector reforms, energy, electricity, megawatts. Any nation whose energy need is epileptic in supply prolongs her development and. The initial design of the reforms envisaged four stages of development. Pdf deregulation of electricity sector in nigeria has brought to the fore, the need to explore power generation options for the improvement of power. The standard text in policy reform is that until the reform is codifiedin an act of parliament, the gains of the reform remain reversible. The national electric power policy 2001 and the electric power sector reform act, 2005 the 2005 reform act constitute the framework under which fundamental reforms to the power sector in nigeria. Pdf constant power supply is the hallmark of a developed economy. Poor power supply background until the reforms in power sector of nigeria in 2005, the transmission of the energy into houses was the sole problem of the nigerian federal government. The proposed economic and power sector reform program epserp is the banks response to a formal request of the fngn in may 2009 for a quick disbursing fiscal stimulus adf loan to support its efforts aimed at mitigating the adverse impact of the global financial and economic crisis. Doc electric power sector reforms in nigeria tiwalolu. Until the power sector reforms of 2005, power supply and transmission was the sole responsibility of the nigerian federal government. It highlighted some of the challenges such as severe electricity crisis due to the appalling state of power.
The effect of control measures in the power sector reforms. This paper serves as a flashback into the history of nigeria s power sector. Power sector reforms in nigeria covenant university. It presents the way forward for epileptic power supply by embracing embedded generation as a potential option to improving power supply in nigeria. The trouble with nigeria s power sector the power sector reform in nigeria has come with both pains and gains, with the former taking the shine off the noble intents of the privatization exercise. Privatisation in the power sector 3 introduction nigeria s power sector reform has proceeded as scheduled. Since 2005, the whole sector was privatized, and now its the sole responsibility for them. Nigeria power sector privatization program appraisal. In this publication we look at some of the milestones that have been crossed and explore the next steps in the sale of 17 federal government power assets. The federal ministry of power is the policy making arm of the federal government with the responsibility for the provision of power in the country.
Preparation and implementation support for a power sector rec. In addition to improving cost recovery and the financial health of utility systems in nigeria since. The paper assesses the power sector reforms from the obasanjo administration 1999 to date with a view to bringing out the problems and prospects, challenges and defects associated with the reforms. Objectives of the study the main objective of this study is to examine the effectiveness of control measures in the power sector reforms on electricity development in nigeria.