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Presidency, Austrian firm begin talks on N68b power project

Posted by By Yakubu Lawal (Lagos) and Emeka Anuforo (Abuja) on 2005/05/17 | Views: 818 |

Presidency, Austrian firm begin talks on N68b power project


FOREIGN investors are already responding to the Federal Government's bid to unbundle the National Electric Power Authority (NEPA) and also open up the energy sector to private operators.

FOREIGN investors are already responding to the Federal Government's bid to unbundle the National Electric Power Authority (NEPA) and also open up the energy sector to private operators.

Among other prospective investors, a consortium of eight Austrian energy firms has sent its officials to Nigeria to hold talks with the Federal Government on the reforms of the energy sector.

The firm plans to invest N68 billion (400 million) in the power sector in the first five years of its planned operations in Nigeria.

Some officials of the firm, M. Schneider GMBH arrived in Nigeria yesterday to discuss with the Presidency, Ministry of Power and Steel and NEPA on areas it can put its investible funds.

The Chairman of M. Schneider Energy Limited (the local subsidiary of Schneider International), Mr. Albert Awofisayo, said that the Austrian company wants to participate in the transmission and distribution segment of the industry.

He said Schneider also plans to set up an electrical equipment manufacturing company in Nigeria to boost its operations when it finally takes off.

Awofisayo said NEPA transmission and distribution facilities as well as sub-stations had been listed for inspection by the visiting Austrian experts with a view to having more details of the problems of the sub-sector.

The firm chief explained that the visit was a follow up to the partnership and agreement Schneider signed recently in Vienna, Austria with Nigeria. The event was witnessed by the Nigerian Ambassador to Austria, Abiodun Owoseni as well as Austrian Minister of Economy and International Assistance.

Besides the problem of power generation, Awofisayo said that a lot of electricity is lost in transmission process, usually about 40 per cent, before the power gets to the point of final distribution or consumption.

"A lot can be done in this respect by ensuring that over 90 per cent of power that is generated gets to the final consumer through a power saving technology that will be introduced into the sector," he stated.

Besides the fact-finding mission of the Austrian firm, a careful study on the possible set up of an Independent Power Project (IPP) would also be undertaken by the visitors, Awofisayo said, adding that the IPP project would form part of the company's medium to long-term objective in Nigeria.

He said a proposal had been submitted to the government to facilitate this development aimed at boosting private sector participation in the electricity sector.

"This technology in the long-run will entail manufacturing of electrical fittings, low voltage, sub-station, equipment as obtained in Europe and other technologically advanced nations," Awofisayo stated.

According to him, Austria is the hub of electricity distribution in Europe with the state of Vienna of 2.5 million population generating about 40,000 megawatts (MW) of electricity while Nigeria with over 120 million people hardly generates 4,000 MW.

He remarked that even the little that was being generated was lost through transmission lines and the sub-stations as well as the distribution facilities.

Some of the companies under M. Schneider of Austria are: FBG - Freileitungsban, ELSTA and MOSDORER, ISKRA, PPC Insulators based in Austria, BEZ Transformatory and ETD-BEZ Group of Czech and Slovakia, Driescher Gmbh, Stabilin Nigeria and Areva Nigeria.

Their Nigerian partners are Folkony Limited, Akiya Nigeria Limited, Vamed Engineering, which operates M. Schneider Energy Nigeria.

Relatedly, two officials of ABB International (a key player in the power sector) have said that NEPA's major problem was distribution.

At a power technology workshop in Abuja over the weekend, ABB's Area Sales Manager Africa, Mr. Jan Skogeby, said that NEPA's problem borders on distribution.

To him, "the quality of the distribution network is low. If the distribution is one automated network, if you control it from one central station, you can avoid outages and you would have power from at least some time."

On the government's planned unbundling of NEPA, Skogeby stated that it was a good policy saying that, "to privatise the units especially distribution and generation is the right move."

Skogeby urged the government to pursue the implementation of the policy to a logical conclusion.

Also, the Managing Director of ABB Nigeria, Mr. Paul Mair said that part of the problems of NEPA had to do with being able to collect money from it customers.

"If you manage to collect money for the energy provided clients, you may have enough to re-invest in latest technologies, train staff and generally service stations. As far as I know, only about 50-60 per cent of the consumption is being paid for. This is a big issue because money is bound to make the whole difference. If you don't collect your money from the consumers, then you can't have enough to make things work," he said.`

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