Why the $10 billion Nigerian Power Reform Failed: Hasty Privatisation, Improper Coordination and Inadequate Tariff Structure
February 11th, 2008 | Published in Energy, Nigeria
The Honorary Strategic Adviser to President Umaru Musa Yar’Adua on Energy, Dr. Rilwanu Lukman, issued a bleak report on the Nigerian power sector:
Lukman said the hope of generating electricity above 4000 megawatt this year was unattainable. He stated that although the nation’s short term demand was 8000MW, only 4000MW could be attained A target to attain 10,000 had been set for last December. Lukman identified hasty privatisation, improper coordination in the power sector and inadequate tariff structure as factors responsible for the failure of the reforms begun by the Obasanjo administration. He called for an effective holistic master plan for the development of the electricity industry, including appropriate funding. Without them, he said, no nation could develop that sector. The former OPEC president, however, said there could not be a one-off solution to the problem of power supply, describing the problem as a moving target.
The report has all the right phrases and recommendations; pretty much along the same line of what we heard in 2000 through 2007. A power reform exercise that cost $10 billion!
