Nigeria's electricity supply in the last 3 months and how it affects you – key takeaways from KPMG's analysis

A man working on electricity cables in Nigeria   [thewillnigeria]
  • KPMG releases Q1 2019 Power Sector Watch and the analysis of the electricity industry.
  • The report analysis the mini-grid scheme and how 21,000 households will benefit from reliable electricity at an affordable tariff.
  • KMPG also urges the operators of the Nigerian content policy to ensure compliance with the provisions or risk regulatory sanctions and in line with President Muhammadu Buhari's executive order No 5 signed last year. 

As Nigeria moves to increase local content in the Nigerian electricity industry, KMPG highlights activities in the sector for the first quarter of 2019.

The Q1 2019, Power Sector Watch released by KPMG last week showed that despite challenges in the power sector, there have been concerted efforts by government and other stakeholders to see the sector performing at its optimal potential.

According to the report, “Although Nigeria’s electricity industry has mostly been privatised, the roles of government cannot be overemphasised; given the need for policy development, continued reform advocacy, capacity development and other non-investor activities. 

“All these are necessary to achieve the collective objective of restoring the industry’s viability and improving the overall business environment.

Business Insider SSA by Pulse looks at key takeaways from the report:

The mini-grid project allows communities to access reliable electricity supply at an affordable rate. The project is supported by the European Union, German Government through the Nigerian Energy Support Programme (NESP) in collaboration with the Federal Ministry of Power, Works and Housing).

If successfully implemented, the scheme will provide 21,000 customers with access to reliable electricity at an affordable tariff through the support of privately-led off-grid solar mini-grid projects. 

According to KPMG's Q1 analysis, the scheme will help to reduce inadequacy in production, transmission and distribution of electricity for Nigeria's growing population.

KMPG states that the development of renewable energy on solar off-grid and mini-grid projects have yielded little results.

The local content policy stipulates that all licensees shall ensure that first consideration is given to qualified Nigerian operators for all works and services in the electricity industry. 

This is in consonant with President Muhammadu Buhari's executive order on local content in the areas of science, technology and engineering. 

Executive Order 5 seeks to improve local content in public procurement and promote the application of science, technology and innovation towards achieving the nation's development goals across all sectors of the economy. 

KMPG urged the operators Nigerian content policy to ensure compliance with the provisions or risk regulatory sanctions. 

The release of the Regulations is laudable, however, achieving the set targets may remain a challenge as is the case with the 3-year metering target defined in the Meter Asset Provider (MAP) Regulations, 2018. 

“NERC must, therefore, recognise that challenges, such as gaps in human capacity and technical expertise, may be encountered by operators in achieving the specified targets. It is, therefore, important that it works with stakeholders in the sector to draw up a plan to address these challenges.”

The National Content Development Regulations will increase employment opportunities.

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