![The Central Bank of Nigeria, CBN. [PHOTO CREDIT: Ehud Kaduna]](https://i0.wp.com/media.premiumtimesng.com/wp-content/files/2022/01/20200913_161409-scaled-e1652250793565.jpg?fit=2387%2C1702&ssl=1)
Ultimately, Tiga reveals that Nigeria’s energy sovereignty depends on a fundamental shift in governance philosophy. We must move beyond the vanity of the “ribbon-cutting” ceremony and instead master the complex institutional and operational frameworks required for long-term sustainability. This is the story of how one project looked past the dignitaries and the photo-ops to ensure the lights actually stay on, providing a template for a new era of sub-national energy independence.
Building a power plant in Nigeria is often less an engineering feat than it is a diplomatic and fiscal endurance test. In a sector littered with ambitious monuments to failure, the 10MW Tiga Dam hydropower project in Kano State stands as a definitive case study in navigating the complexities of Nigerian infrastructure, unlocking the potential of the Electricity Act 2023. It proves that the distance between a spinning turbine and a functional grid is measured not in miles, but in the strength of intergovernmental handshakes, the ingenuity of state financing, and the pragmatic transition from state ownership to private sector operation.
Ultimately, Tiga reveals that Nigeria’s energy sovereignty depends on a fundamental shift in governance philosophy. We must move beyond the vanity of the “ribbon-cutting” ceremony and instead master the complex institutional and operational frameworks required for long-term sustainability. This is the story of how one project looked past the dignitaries and the photo-ops to ensure the lights actually stay on, providing a template for a new era of sub-national energy independence. A recent webinar hosted by the UK PACT Clean Energy Transition Programme offered a rare, behind-the-scenes analysis of the project.
|
|
1. The Jurisdictional Handshake: Navigating Federal-State Overlap
In the Nigerian power sector, projects often stall not due to a lack of engineering talent, but because of what we might call “Institutional Friction.” The Tiga Dam project faced a classic federalist dilemma: the dam was originally a state asset, it became a federal asset under the jurisdiction of the Hadejia-Jama’are River Basin Development Authority (HJRBDA) in 2003, and then the site of a state-led power ambition in 2011.
|
|
|
|---|
Dr Ghaddafi Sani Shehu, the honourable commissioner for Power and Renewable Energy in Kano State, noted that the breakthrough was not found in legal combat, but in a proactive institutional handshake. By aligning state power objectives with federal water and irrigation mandates, Kano State secured the “Right of Use” through a collaborative Memorandum of Understanding (MOU).
The Policy Takeaway: Sub-national governments must move from a posture of competition to one of “Collaborative Federalism.” For the business community, this institutional alignment is the first and most critical “de-risking” signal. Without a clear handshake between federal water regulators and state energy ministries, even the most bankable hydropower project remains a “stranded asset.”
2. Financing the Vision: From State Spend to Strategic Partnerships
The development of the Tiga small hydropower plant was a testament to state-led fiscal commitment. Unlike many smaller projects that rely heavily on external grants, Tiga was funded by the Kano State Government, representing a massive ₦14 billion investment in its broader energy infrastructure. By committing its own resources, Kano signalled a level of “skin in the game” that is often missing in public sector projects, ensuring that the state remained the primary driver of its own development.
For other states, Kano’s journey suggests that while initial projects may require heavy state budgetary lifting to prove concept, the goal should be to leverage those successes into international partnerships. By demonstrating serious intent at Tiga, Kano is now better positioned to utilise the expertise of UNIDO and the UK PACT programme to optimise the Challawa and Garri projects, thereby increasing their credibility with private concessionaires.
However, the “Tiga Model” has paved the way for a more sophisticated, blended financing strategy for Kano’s future energy assets. For new projects currently in the pipeline — specifically the Challawa Gorge and Garri Dam projects — the state is proactively working with international technical partners, including the United Nations Industrial Development Organization (UNIDO) and UK PACT.
This transition marks an evolution in strategy: Using the success of Tiga to attract international technical de-risking and grant support for the next phase. While the state provides the physical foundation and political security, these international partners ensure that the electromechanical technology meets global standards, thereby reducing the technical burden on the state’s balance sheet.
The Financial Blueprint: For other states, Kano’s journey suggests that while initial projects may require heavy state budgetary lifting to prove concept, the goal should be to leverage those successes into international partnerships. By demonstrating serious intent at Tiga, Kano is now better positioned to utilise the expertise of UNIDO and the UK PACT programme to optimise the Challawa and Garri projects, thereby increasing their credibility with private concessionaires.
3. The Maintenance Mirage and the $300,000 Fiscal Reality
The completion of an infrastructure project is often mistaken for the finish line. In reality, it is the start of a decades-long fiscal commitment. The Tiga project was completed in 2019, but it faced significant delays in commissioning.
The honourable commissioner shared a candid insight: during the testing phase, the state-owned SPV encountered a complex technical breakdown. “To bring in international experts and perform the necessary upgrades to proprietary software and hardware, the state was presented with a $300,000 maintenance bill”.
For any sub-national government, such an unbudgeted expenditure is a fiscal crisis. It forces a difficult choice:
- Allow the asset to deteriorate while waiting for the next budget cycle.
- Attempt an ad hoc, substandard repair that risks the entire installation.
- Admit that the bureaucratic structure of the public sector is ill-equipped for the technical agility required by a power plant.
Kano State chose a more sustainable path: the PPP Pivot.
If we build 10MW plants in rural corridors only to evacuate that power to city streetlights and water treatment plants, while the host communities remain in the dark, we risk building a grievance rather than a utility. The Tiga project manages this by powering essential public services, such as the Tamburawa Water Treatment Plant — a clear social good.
4. The Shift from Operator to Regulator: A Growing National Standard
The transition of the Tiga and Challawa Gorge projects to a Public-Private Partnership (PPP) model — concessioning Operations and Maintenance (O&M) to the private sector — marks a fundamental shift in governance philosophy. By handing the “keys” to an experienced partner like Skipa Nigeria Ltd, the state transformed a liability into a performance-based asset.
This lesson is not unique to Kano. It mirrors a broader institutional pivot across Nigeria’s energy sector. The Rural Electrification Agency (REA) has encountered similar operational hurdles with its legacy assets. For instance, the transition of the Energising Education Programme (EEP) Phase 1 and various capital minigrids to a PPP structure is a direct response to the sustainability gap of public management. Like Kano, the REA is moving away from direct operation toward a model where the private sector assumes the “technical risk.”
In this model, if a turbine fails or a solar array degrades, the financial loss is borne by the private operator. This creates a natural incentive for preventative maintenance and 24/7 reliability that the public sector simply cannot duplicate.
5. The Social License: Ensuring Inclusive Benefits
The webinar also touched on a vital lesson regarding the “Social License to Operate.” A story was shared of a water project in India where villagers, frustrated that huge pipes bypassed their homes to serve a distant city, drilled holes in the infrastructure to claim their share.
If we build 10MW plants in rural corridors only to evacuate that power to city streetlights and water treatment plants, while the host communities remain in the dark, we risk building a grievance rather than a utility. The Tiga project manages this by powering essential public services, such as the Tamburawa Water Treatment Plant — a clear social good. However, as we look toward future projects, the challenge for policy leaders will be to integrate local community access into the project’s financial and technical design, regardless of the financial viability of serving local residents.
Final Analysis: A Blueprint for the Sub-national Grid
The Tiga Dam project demonstrates that Nigeria’s energy future will be won or lost at the sub-national level. Success requires:
- Diplomacy: Handshakes that bridge the federal-state jurisdictional gap.
- Partnership: Using state-funded successes to attract technical partners like UNIDO and UK PACT for new sites.
- Pragmatism: The humility to delegate operational control to the private sector — a model now being scaled nationally by the REA.
- Foresight: Rigorous project preparation that accounts for the “Social License.”
The sleeping giant of Nigeria’s small hydro sector is waking up. But to keep it awake, we must ensure our institutional frameworks are as robust as our concrete dams.
The UK PACT Clean Energy Transition Programme continues its “Hydro Series” in April, focusing on the NESCO project in Jos — a century-old legacy currently being revitalised by a new generation of Nigerian investors.
Tobi Oluwatola is a director at AP3 Advisory, the implementing partner for the UKPACT Catalysing Run-of-River Hydropower Project.
Discover more from Premium Times Nigeria
Subscribe to get the latest posts sent to your email.
