FG issues 22 fresh licenses to power sector operators

Minister for Power, Barth Nnaji

The Federal Government has issued 22 fresh licenses to independent power operators as an effort to meet the target set for the power sector. A total of 6,165MW of electricity is expected from the new licensees.

Eight companies were issued off-grid generation licenses to supply electricity for the use of different companies in Ogun, Lagos and Rivers states, while10 licenses were issued to companies that would generate a total of 5,941MW of electricity to be fed into the national grid for distribution.

Two other licenses were issued to two investors for power generation in Abia and Kaduna states, while one distribution and bulk trading license each was issued to different operators.

Other companies have also been given licenses to service specific companies and states. The off-grid generation licensees include Tower Power to generate electricity in Ogun State; Akute Power Limited) for Lagos Water Corporation; Shoreline Power Limited for Ogun State; CET Power Projects in Ogun state; Income Electrix Limited in Rivers state; Energy Company of Nigeria for Nestle Nigeria Limited, Ogun state and Ilupeju Power Limited for Academy Press Limited in Lagos.

Zuma Energy Nigeria Limited is expected to generate and feed into the national grid electricity from its coal and gas-fired plants in Kogi and Imo states.  Other companies expected to supply electricity to the national grid include Alaoji Generation Company Limited, Knox J&L Energy Solutions Limited Olorunshogo Generation Company Limited, Ogorode Generation Company , and  Azura Power West Africa. Other licensees include MBH Power Limited, Eleme Petrochemical Company Limited, Delta Electric power Limited, Geometric Aba Power Limited and Kaduna Power supply Company Limited.

Aba power Limited in Abia state was granted tenure extension on its power distribution license, while the bulk trader license was issued to the Nigerian Bulk Electricity Trading Company PLC that is expected to bear the World Bank partial risk guarantee to reassure and encourage power generation companies to go into agreements with distribution companies for power supply without fear of unforeseen losses.

The Minister of Power, Barth Nnaji, while presenting the licenses to the beneficiaries charged them to help realize its aspiration of providing adequate supply of electricity in the country by going into work immediately with the licenses, adding that the government has done its part in removing impediments to investments in the sector.

“We have a strong regulatory commission in place. A lot of the challenges that impeded investments in the sector a year ago have been surmounted. The tariff, which was not cost reflective, has been resolved. Now there is sovereign guarantee to investors for banks to give money for investments.

“Government has a $500million guarantee for gas supply to ensure that the power producers can enter agreements with the gas producers without fear that it will not be delivered. Another $1billion is to be provided for partial risk guarantee by the World Bank for the bulk trader. The Ministry of Power is also providing N20billion to the bulk trader as working capital to enable it takeoff without any delay to ensure that they have enough money to pay the operators. Another N20billion is also being provided for Nigerian Electricity Liability Management Company (NELMCO) for liabilities at the point of privatisation.

“A lot of the issues that impeded investments in the power sector are being addressed. Government is committed to addressing all the concerns of labour to ensure that the transition is smooth. Investors should feel confident and move fast and help government transform the industry,” he said.


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