As 2022 was about to wind up, the managing director of the Nigerian Bulk Electricity Trading Plc (NBET), Mr Nnaemeka Ewelukwa, disclosed that plans were underway by the agency to deploy an automated energy trading platform/exchange in the Nigerian Electricity Supply Industry (NESI) that would promote bilateral trading between Independent Power Producers (IPPs) and commercial/industrial customers in 2023.
Eweluka made the disclosure in his presentation at NBET’s 2nd edition of stakeholders workshop held for Power correspondents and representatives of select civil society organisations (CSOs) in Lagos titled, ‘Actualising Enhanced Electricity Supply and Commercial/Industrial Decarbonisation in Nigeria”.
There had been claims that the industry’s electricity generation capacity outweighs those of transmission and distribution capacities respectively, to the extent that over 2,000 megawatts of power is usually stranded and cannot get to Nigerians who are in dire need of power.
A move by the federal government to address the waste of this so much needed electricity amidst biting liquidity crisis in the sector led to the introduction of Eligible Customer policy sometime in 2017, which has not worked out as expected to date, and there’s the need to step up the game by any means possible to meet up, hence the imperative of this latest move by NBET.
The Eligible Customer regulation introduced in 2017 permits electricity generation companies (GenCos) and Independent Power Producers (IPPs) to by-pass the Nigerian Bulk Electricity Trading Plc (NBET)) and DisCos to sell electricity directly to classified consumers.
Ewelukwa said that the platform would have multiple energy brokers playing key roles in linking energy suppliers and customers registered.
According to him, the IPPs wishing to sell power can register on the platform and immediately have access to a comprehensive database of commercial/industrial customers across the country, and their energy requirements.
He listed those that would be involved in the platform to include: Commercial and industrial customers and industrial clusters; generation plants; transmission and distribution network.
Others are: Gas pipeline network; energy locations, including solar irradiation, wind and mini-hydro potentials.
“The platform will efficiently link sufficient numbers of buyers and sellers thus facilitating price discovery.
“With price discovery, energy buyers and sellers have the assurance that they are purchasing these commodities at fair prices in a reliable marketplace.
“It will also ultimately enhance overall visibility of tariffs, capacity availability, costs and prices along the energy value chain, which will aid buyers and sellers in undertaking transactions,” he said.
Ewelukwa said that the platform would facilitate private investments in the transmission/distribution network in order to fully bridge the infrastructure gap between electricity demand and supply.
According to him, it will also reduce the technical, commercial and collection losses in the system.
He said that the platform would also promote business partnerships involving customers, IPPs, Transmission Company of Nigeria and the Distribution Companies.
Ewelukwa also said that a comprehensive interactive map would be developed by NBET, which will show the geo-locations of the facilities within Nigeria and the ECOWAS sub region.
He said that the interactive map would facilitate transaction structuring by willing buyers and sellers, network investment coordination.
It would also guide investment decision-making, and facilitate greater policy planning and efficient resource planning.
Ewelukwa informed his audience that all other critical stakeholders such as the Federal Ministries of Power; Finance, Budget and National Planning; Industry, Trade and Investment; the Securities and Exchange Commission, SEC, the Nigerian Electricity Regulatory Commission, NERC, as well as the Nigerian Midstream and Downstream Petroleum Regulatory Authority, etc. were being engaged.
The managing director said that the administration of Power Purchase Agreement (PPAs) and vesting contracts by the agency had resulted in electricity payments worth N5 trillion from February 2015 to date.
According to him, the Azura Power Plant in Edo, the first financed power project in Nigeria, heralded an investment of close to 1 billion dollars.
Ewelukwa also revealed that NBET had executed PPAs with 14 solar Independent Power Projects (IPPs) for one gigawatt (1GW) of electricity.
He said as the anchor for the Federal Government of Nigeria-World Bank Power Sector Recovery Programme (PSRP), NBET facilitated the $750 million loan for the Power Sector Recovery Operations (PSRO) from the World Bank.
Highlighting several other milestones achieved by agency towards a self-reliant power sector in Nigeria, the NBET boss noted that the agency was instrumental to FGN’s budgetary appropriation in addressing tariff shortfalls in the electricity market, adding it facilitated the privatisation of generation companies (GenCos) through PPAs with core investors.
“Others are the 2.5 billion dollar privatisation of GenCos and DisCos (2013). Facilitation of Afam Power Plc and Afam the three Fast Power limited (N105.3 billion; 343.6 million billion
“The successful and transparent management of the N1.3 trillion payment assurance facility that aided a 30 per cent increase in the highest peak generation ever attained.
“Attainment of peak generation from 4500MW (February 2015) to 5,800MW (March 2021), the highest ever, due to capacity recovery by generation companies,” he said.