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Power investors decry equipment vandalism

By on September 23, 2013

Equipment vandalism, which has continued to plague power distribution in the country, is showing no sign of abating and experts have warned that new investors in the 10 distribution companies across the country are facing the challenge.

Some senior officials of the Power Holding Company of Nigeria, said the menace had assumed a wider dimension since the middle of last year with its attendant huge financial losses.

A total of 69 distribution transformer substations belonging to the Ikeja Distribution Company were reportedly vandalised in 2012, while various electrical items were also stolen.

Similarly, the Manager, PHCN Ikeja Business Unit, Mr. Lateef Olaleye, noted with dismay that the vandals were disguising as cart pushers to vandalise electrical installations in the district.

He said, “Over the past four months, we have recorded the destruction of nine transformer substations by vandals. Oba Akinjobi’s 300KVA substation was vandalised three times in March, April and May this year, while Remi Fani-Kayode’s 1500KVA substation was first vandalised on April 8.

“The vandals came again two days later on April 10 and stole virtually all the replaced cables and other substation materials.”

Just last week, the Public Affairs Manager, PHCN, Akure, Mr. Oghale Eduziare, said one of the challenges militating against regular power supply in Ondo State was the high rate of vandalism of  equipment and installations.

Eduziare said, “If this ugly trend is not checked by the host communities that are saddled with the protection of installations in their domain, achieving improved power supply will be a mirage.

“We spent millions of naira to replace vandalised equipment; this amount would have been better expended on new projects for the customers.’’

The Eko Electricity Distribution Company has also called on the police and the State Security Service to help sustain the fight against vandalism of power installations.

The Chief Executive Officer of the company, Mr. Oladele Amoda,  who lamented that the cost of replacing vandalised installations  was becoming unbearable, said, “We spend millions of naira to replace the vandalised equipment; this amount would have been better expended on new projects for the customers.”

Industry analysts, who had been watching the power sector privatisation with keen interest, warned that vandalism would be a serious challenge for the new investors in the Discos.

They predicted that the menace might be on the increase after the takeover of the power assets by the preferred bidders.

The new investors waiting to take over the power firms are West Power and Gas, the preferred bidder for the Eko Distribution Company; NEDC/KEPCO, Ikeja Distribution Company; 4Power Consortium, Port Harcourt Distribution Company; Vigeo Consortium, Benin Distribution Company; Aura Energy, Jos Distribution Company; and Kann Consortium, Abuja Distribution Company.

Others are: Integrated Energy Distribution and Marketing Company, the preferred bidder for both the Ibadan and Yola Distribution Companies; and Sahelian Power, Kano Distribution Company.

Aside from obstructing power supply, experts said vandalism could pose a serious threat to investments by the new investors.

“Vandalism is a threat to the ‘new Discos’, especially those with large coverage area. High tension lines and transformers located and serving remote areas are most at risk,” the Chairman, Vigeo Power Limited, Chief Victor Osibodu, told our correspondent.

He explained that assets susceptible to vandalism were those made of copper, adding that the vandals were mostly workers of PHCN contractors and those dealing in electrical appliances.

According to him, there is a need to first carry out an assessment of the nature and level of vandalism as well as the financial loses involved.

Osibodu said, “In resolving this issue, a distinction must be made between government assets, such as street lighting, and the Discos’ assets. The Discos can easily insure their network assets.

“The government must work on the existing legislation and the court processes to ensure quick disposal of vandalism cases. There is the need for enforcement of these laws to serve as a deterrent to others.”

To replace the vandalised power assets, he suggested that the government must take responsibility, while the regulator must accommodate capital expenditure to replace the vandalised assets.

An energy expert and legal practitioner with Banwo & Ighodalo, Mr. Ayodele Oni, expressed optimism that the new investors would be more interested in spending money for research and development to fashion out ways to reduce the incidence of equipment vandalism and electricity theft.

He said, “To reduce the incidence of theft, the government should better enforce laws to provide an enabling environment for businesses related to the power sector. Furthermore, new security related technologies should be adopted to stem this state of events.

“The new owners of the power generation and distribution companies should adopt business process re-engineering and deploy new technologies, which will easily help detect such activities.”




One Comment


    September 23, 2013 at 1:54 pm

    some phcn officers and men are accomplices in the criminal act