Nigeria to Tweak Power Sector Reform Act, Seeks Lawmakers’ Support

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The federal government has disclosed its plan to review provisions in Nigeria’s eight year-old Electric Power Sector Reform (EPSR) Act to fully reflect existing challenges and changes in the country’s power sector reforms route.

This is just as the Minister of Power, Prof. Chinedu Nebo has said the government was working hard to ensure that the power sector did not cave-in to existing challenges ranging from paucity of funds to repair and sustain the country’s transmission network.

Minister of State for Power, Hajia Zainab Kuchi, Thursday in Abuja hinted of the review of the law when she subtly galvanised the support of the National Assembly towards the scheduled review process which she also said had earnestly begun.

Both ministers spoke at an oversight visit to the ministry by the Senate Committee on Power and Steel led by its Chairman, Senator Philip Aduda.

Kuchi said: “The EPRS Act came into effect in 2005 and this Act sincerely needs to be reviewed; we have a golden opportunity to do that now because in the last  Federal Executive Council (FEC) meeting, we were given the opportunity to come up with what we think should change in the EPRS Act.

This, we are working on now such that very soon, it goes to FEC and when it does go the FEC, it will finally fall back to you; we will appreciate all the support we can get from you to get it out on time.”

She however did not give further details on the review process but explained that the move was aimed at consolidating milestones achieved from ongoing reforms in the power sector.

Accordingly, the EPSR Act which came into being in 2005 was drafted to provide a legislative framework for reform of the Nigerian power sector in accordance with policies ensconced in the National Electric Power Policy (NEPP).

The Act also removes operational and regulatory responsibilities of the electricity industry from the federal government and provides the legal backing for the unbundling of the Power Holding Company of Nigeria (PHCN) into successor companies which are being privatised to take over the various functions, assets, liabilities and staff of the defunct National Electric Power Authority (NEPA).

Within terms of its conception, the Act is expected to enable the development of a competitive electricity market, while creating a regulatory body that licences and regulates the generation, transmission and distribution of electricity in the country.

Additionally, the Act provides for the determination of tariffs and for other related matters by the regulator which is the Nigerian Electricity Regulatory Commission (NERC), thus, unbundling the PHCN into 18 successor companies to ensure greater operational autonomy and market development with the private sector as the key driver for the future of Nigerian Electricity Supply Industry (NESI).

While intimating the committee on the challenges of the ministry as well as efforts made so far to mitigate same, Kuchi said: “We need to deliver on all the projects we have started and we need your support on all the other projects the minister has mentioned; we also need your support and objectivity where we have challenges especially the Rural Electrification Agency (REA) which has the longest list of ongoing projects now and outstanding debts to pay.

“We also have a retinue of over 400 projects and what we intend to do is to survey those projects but we want the committee to be very supportive so that we can get the actual quantum needs that these projects will require in the 2014 budget.

“We need to reposition the National Power Training Institute of Nigeria (NAPTIN) to the extent of commercialisation for it to do its job in providing the capacity requirement of the sector.”

The minister also said of the status of the bill establishing the Hydro Power Producing Areas Development Commission (HYPPADEC), that: “We will appreciate that you expedite action on the HYPPADEC bill currently with the National Assembly because in 2010 and 2011 we lost the budgetary allocation you gave us and 2012, we took responsibility to do renovation of the acquired property for the commission.

“But we will appreciate if you will effect the minor amendments on the bill which is still all about the downward review of the host community fund to 10 percent because no investor will agree to pay 30 percent as it were.”

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