The Minister of Power, Adebayo Adelabu, expressed concern over the increasing number of bulk electricity consumers who are disconnecting from the national grid to produce their own electricity.
Adelabu highlighted that relying on the grid is a more dependable option compared to the captive power plants currently favored by these bulk consumers.
He lamented that, despite achieving a historic generation of 5,155MW, the electricity is not being utilized.
The minister made these remarks on Thursday during the Nigeria Electricity Liability Management Company’s Board retreat in Lagos.
He said, “The majority of bulk electricity users, such as industries, are off the grid due to lack of trust and confidence in the past.
“They now have their own captive power plants in their industries which is more expensive.”
He stated that relying on captive power instead of connecting to the grid is costlier.
“The average cost of producing captive power is about N350 to N400 per kilowatt-hour for those connected to gas lines. For diesel, it’s about N950 while petrol is about N550,” he said.
He mentioned that steps would be taken to persuade these large consumers to reconnect to the grid.
“Once consumers and industries see the trust, the confidence and the stability we are giving, they would be encouraged and reconnect to the grid for a cheaper source of power.
“We aim to attain the threshold of a new era in power delivery with a target of 6 gigawatts by the end of December 2024, in the short term, and the Federal Government is still focused on Vision 30-30-30. By 2030, we aim to achieve 30GW in the medium term, with renewable energy constituting 30 per cent and universal access in the long term. We must align on the principles guiding our activities and the strategies driving our progress,” he added.
The minister revealed that the government is employing a variety of strategies to achieve these goals for Nigeria’s electricity supply sector.
The minister also considered the possibility of implementing varying tariffs during peak periods to boost demand.
“Having noticed a drop in demand during the off-peak period, we plan to stimulate demand by having a different tariff during the off-peak period. These are some of the efforts we are looking at, especially with our smart meters,” he explained.
He urged the board members to reflect on how to embed corporate governance in driving sustainable growth in the sector. “As we manage the liabilities of the Nigeria Electricity Supply Industry, it is imperative that we uphold the highest standards of transparency, accountability, and integrity. Our actions and decisions must always align with the principles that safeguard public interests, ensuring that trust is maintained and strengthened across the board,” he said.
He also urged participants in the energy sector to adopt environmental, social, and governance principles in their practices.
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“In today’s world, ESG considerations are no longer optional; they are integral to every corporate operation. NELMCO’s role goes beyond managing financial liabilities – we are also stewards of social and environmental responsibilities.
“We must incorporate sustainable practices into our strategies, ensuring that our actions contribute to Nigeria’s broader goals of achieving the nation’s climate ambition and fostering social equity. This commitment to ESG will not only enhance our reputation but also ensure long-term value creation for all Nigerians,” submitted.
