LIGHTING

Nigeria 2018 | ENERGY | B2B

Once Nigeria makes progress in terms of strengthening and expanding electricity grids, it will see rapid growth in electricity supply and economic development.

Kola Adesina
KOLA ADESINA
Managing Director
Sahara Power Group
Onyeche Tifase
ONYECHE TIFASE
CEO
Siemens

What have been some of the highlights of the company's operations in Nigeria?

KOLA ADESINA Sahara's foray into the power sector began in 2000, when we were given the opportunity to supply diesel to power generators that provided electricity to Abuja, Nigeria's Federal Capital Territory. Between 2000 and 2002, we supplied diesel to power the city of Abuja, which was about 55MW. We eventually partnered with Korea Electric Power Corporation (KEPCO) to acquire Egbin Power Plc, a process that was concluded in 2013 in line with the nation's privatization exercise. In pursuit of our strategy of deploying an integrated power infrastructure, we also acquired the Ikeja Electricity Distribution PLC in 2013 and the River State power generation assets in 2014. In total, Sahara Power Group currently operates power generation facilities with a total of approximately 1,750MW of available capacity.

ONYECHE TIFASE We have focused on turning our strategy into one where we are not just seen as an equipment provider but as a solution provider, partner, and advisor for investors in the power sector. We are in close cooperation with both private and public power sector organizations and work with them to understand the issues that hinder more profitable and efficient results. Siemens has a vast portfolio of products, systems, and services providing solutions all the way from gas to generation, transmission, distribution, smart grids, metering, and revenue collection, and we seek to use our best practices from around the world to resolve the challenges that investors face along the entire power sector value chain.

What should be done to increase the investment attractiveness of the sector?

KA We need to address and correct the price differential between the actual cost of electricity and how it is priced currently because that forms the foundation of generating the investment required to transform the system and make power supply more reliable and efficient. One can even suggest that to the extent that electricity can be considered a social service, the sector would benefit immensely from government support to cushion this price differential to make the sector more productive and sustainable. Another important factor that is responsible for the high price of electricity is the lack of conservation. All Nigerians need to get to a point where conservation becomes a way of life. With more awareness campaigns and a corresponding desire by electricity consumers to take ownership of how they consume electricity, appreciating the various elements responsible for cost-reflective tariffs and policies enshrined to ensue consumer protection, we will definitely make significant progress.

OT We must first recognize that the challenges facing the power sector are highly extensive and intertwined. The power value chain is a highly integrated one, and there are issues at every point that must be resolved to ensure upstream and downstream projects are not stranded and ultimately achieve their intended impact. The government is pushing for the fast track delivery of smaller-scale, embedded power and renewable solar PV projects that can quickly increase generation capacity of the grid. Developers of these projects will, however, still encounter the same issues if the end consumers are unable to access electricity and pay a fair price for energy supplied. It is thus imperative that the government makes available effective funding, payment guarantees, pricing frameworks, regulation, legislation, subsidies and other mechanisms that will trigger further investment in and growth of the sector.

What is your outlook for 2018?

KA For the power sector, we are hopeful that we will witness increased cooperation and the adoption of policies, processes, and partnerships that will help the power sector overcome its challenges. The power sector's goal to be more efficient, transparent, accountable, and responsive is one that all operators must embrace. This is our mantra at Sahara Power Group, and we will stop at nothing to ensure that we work hard with all stakeholders to light up Nigeria and ultimately Africa.

OT I expect the myriad of issues plaguing the power sector to be reviewed and improved on. This will encourage key stakeholders to invest more not just in power generation projects but also in other critical areas. I also expect that execution of ongoing and planned TCN projects will result in a more robust and reliable transmission grid. With effective regulations, improved gas supply, enhanced transmission infrastructure, and more efficient and responsible performance of discos, we will finally be on the right track to scale up power and guarantee stable, affordable power supply for all Nigerians.