HomeBusinessU.S.-Exim Bank to Provide $1.5 Billion in $10 Billion Power Deal

U.S.-Exim Bank to Provide $1.5 Billion in $10 Billion Power Deal


power plant
Nigeria has an acute power shortage

The United States EXIM Bank has signed a Memorandum of Understanding (MoU) with Nigeria’s Federal Government to provide $1.5billion as its commitment towards the March 2012 deal with General Electric to provide 10,000 mega watts of electricity by the year 2020.

The Minister of Power, Prof. Barth Nnaji, made the disclosure in Abuja at a recent meeting with Trade Union Congress (TUC) and the National Electricity Regulatory Commission (NERC), which was initiated by the Minister of Labour and Productivity, Chief Emeka Wogu.

Nnaji added that 10 power plants would be completed between now and the end of next year through partnership with the Independent Power Producers (IPPs), while training would be provided for electricity workers to man the power plants and new sub-stations being built.

He admitted that there was a trust deficit on the part of Nigerians towards the government reforms in the power sector.

“Give us a chance. In fact I will make you a promise; starting from next month, you will begin to see power grow in this country and it will not be reversible. The kind of change we enjoyed after the liberalisation of the telecommunications sector is the same we would have with these reforms in the power sector,” he said.

The meeting was held to clarify the reforms in the power sector after the TUC made queries concerning power issue in Nigeria during the last May Day celebrations in Abuja. Officials of the NLC were absent at the meeting.

Explaining what has been termed as electricity tariff hike which is due to kick off on June 1, 2012, Chairman of NERC, Dr. Sam Amadi, said it was not an increase, but “rather many people would pay less than what they are currently paying for consumption.”

He added that the reforms were also meant to eliminate estimation billing and to increase supply of power so that the regulatory agency can do its work the way it should be done.

Amadi also gave the assurance that all Nigerians would receive meters before the expiration of 18 months; meanwhile he said instead of estimation billing which has been the practice for those who do not have meters, the feeder that supplies each building would be checked to know how much power went through it.

Even though part of the campaign is that the urban poor would pay less, Amadi did not give clear criteria for the agency’s definition of the urban poor.

President General of the TUC, Comrade Peter Esele, however said Nigerians were tired of being given timelines as to when power supply would be constant in Nigeria, “which is why the reforms are being received with skepticism by Nigerians.”

“Not ensuring that power supply is stable before carrying out reforms that could lead to an increase amounts to putting the cart before the horse. If, after spending billions of dollars, the sector is still not attractive, why should we trust the government now? We have not been given reasons why the billions did not improve the sector. I tell you, if Nigerians get 13 hours of stable power daily, they will be willing to pay more,” he added.

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