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BPE proposes privatisation of Transmission Company of Nigeria
The proposed sale of the transmission assets will be the biggest reform Nigeria’s power system would witness since 2013.
In a bid to transform the operations of the
Transmission Company of Nigeria (TCN), the Bureau of Public Enterprises (BPE) has recommended the full privatisation of the country’s electricity transmission network.
In an interview with Bloomberg on Thursday, the BPE Director-General, Alex Okoh, said the agency will “share its proposal very shortly with the National Council on Privatisation that the state-owned corporation be unbundled and then privatized”.
The Transmission Company of Nigeria, 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 license a year later.
The Nigerian Electricity Regulatory Commission (NERC) has moved to enforce compensation to electricity consumers for the under-supply of power to their homes and businesses with effect from July.
This follows several complaints by energy consumers that the Service-Based Tariff (SBT), which has led to a huge increase in electricity bills paid by customers, only places obligations on them without appropriate sanctions for Distribution Companies (DISCOs) that under-supply.
This was made known by the Deputy General Manager, Markets Competition and Rates, NERC, Mr Abba Terab, at the 58
th Session of the Power Dialogue organized by the Electricity Hub, who said that for now, compensation will be based on a 60-day cycle.
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Okoh stated this on Thursday during a webinar tagged, “Financing Public-Private Partnership to Boost Infrastructure Delivery in Nigeria,” chaired by Ahmed Zainab, minister of finance, budget and national planning, and monitored by TheCable.
In 2013, Nigeria privatised the power sector with the distribution (DisCos) and generation (GenCos) sub-sectors sold to core investors.
Nigeria has 13,000 megawatts of installed electricity-production capacity, only about 4,500 megawatts is dispatched to the grid daily, in part because of dilapidated transmission infrastructure.
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“Currently, we are looking at various strategies at reforming TCN,” Okoh said.
“That’s the only segment of the power value chain yet to be reform by BPE. We have privatised or reform generation and the PHCN legacy on generation companies and downstream privatisation.