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Embedded power: 40 firms to supply Lagos 300MW

By BusinessNews Staff on March 13, 2015

A total of 300 megawatts of electricity is being expected from over 40 embedded power generation licences under the Eko Electricity Distribution Company in two to three years’ time.

Holders of these licences, according to a report from the distribution company, have agreed to work with the EKEDC by selling their output to the Disco and it is expected to add that to what it gets from the national grid.

Although the EKEDC said it was still expecting a final go-ahead from the Nigerian Electricity Regulatory Commission in this regard, it stressed it would not hesitate to leverage the opportunity following the dwindling power supply from the national grid to its network.

Three embedded power projects had been given accelerated approval by NERC, and would come on stream before the end of 2015, the Chief Executive Officer, EKEDC, Mr. Oladele Amoda, said.

Amoda, at the quarterly media briefing of the firm, disclosed that the embedded plants, located at Ijora, Ogijo and Apapa in Lagos State, would generate 170MW of power in all.

In addition, Amoda said the firm would be getting 100MW of electricity following the recent rehabilitation of a 220MW steam turbine generator at the Egbin power station.

The repair which came eight years after the system had become inoperable brought the plant back to its installed capacity of 1,320MW.

“The rehabilitated and restored Unit ST-06 brings an additional 220MW to the Nigerian national electricity grid and will also bolster power supply to the Lagos metropolis, thereby improving socio-economic activities in the region,” the Egbin Power Plc said, in a statement.

The four embedded power generation licences issued by the Nigerian Electricity Regulatory Commission have a capacity to generate 273MW nationally.

The licences were issued to Ikorodu Industrial Power Limited, Geometric Power Limited, Kaduna Power Supply Company Limited and Island Power Limited.

The Ikorodu Industrial Power Limited with a licence number: NERC/LC/005 issued on the February 23, 2007, can generate 39MW at Ikorodu, Lagos. The licence is to expire in December 2016.

The Geometric Power Limited with a licence number: NERC/LC/009, can generate 140MW at Aba, Abia State. Its initial licence was granted on December 7, 2006, and will expire in December 2016. But according to NERC, the tenure has been extended to December 6, 2021.

The Kaduna Power Supply Company Limited with a licence number: NERC/LC/067 issued on November 15, 2011, can generate 84MW at Kudenda Industrial Area, Kaduna State. The licence is to expire in November 2021.

Island Power Limited with a licence number: NERC/LC/087 issued on the December 6, 2012, can generate 10MW at Marina in Lagos State. The licence is to expire in December 2022.

Embedded generation is electricity that is obtained outside the national grid through a bilateral agreement between the generator (that is the company that generates the power) and the distribution company.

They generate electricity in smaller scale and give to the Discos directly. The power generation from the grid is allocated to Discos but embedded power is direct and it is between the company that is offering the embedded power and the Discos.

Putting the capital expenditure of the firm at N18bn for 2015, the EKEDC’s chief executive officer said the finance would be sourced from investors’ funds.

“We have been able to sustain the network we inherited. Before privatisation, the right funding wasn’t coming, and our facilities were largely dilapidated. We were also not metering our customers. Now, it is a different ball game,” he said.

According to Amoda, EKEDC is entitled to 11 per cent of the total power generated and delivered to the national grid.

This proportion, he said, translated to between 250MW and 300MW energy currently being supplied to the company from the grid, owing to the dwindling power generation nationwide.

He said between November 2013 and now, the firm had committed about N7bn to the rehabilitation, sustenance and expansion of the network.

“This, however, is just scratching the surface, considering the nature of the network,” he said.

On the Aggregate Technical, Commercial and Collection losses of the company, he said prior to the privatisation of the company, they stood at 35 per cent.

This, he noted, had reduced to 29.4 per cent in recent times, adding that the EKEDC was working to reduce the losses to 10 per cent in five years as directed by NERC.

Commenting on the issue of estimated billings, Amoda appealed to consumers to cooperate with the company, adding that it was planning to roll out free smart meters to all households beginning from this month.

He, however, enjoined consumers to exercise patience or apply for the meters under the Credit Advancement Payment for Metering Implementation, which would be refunded later.

He said the EKEDC had earmarked about $15m to meet the demand of customers on maximum demand pre-paid meters, while another N20bn would be spent on other categories of customers (residential and other smaller users).

CAPMI was designed by the Federal Government to address the slow pace of customer metering by the Discos, as well as the high level of complaints received from customers and dissatisfaction with the prevailing estimated billing.

[Punch]

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