Buhari's scorecard: a closer look at the power sector

Roughly three weeks ago, the Stears newsroom showed how Muhammadu Buhari, Nigeria’s President, has performed in several critical economic areas based on his administration’s party manifesto.

The performance failed to inspire confidence in most sectors we covered—from education, employment, and agriculture. However, when it came to tech, energy, gas, and telecommunication, some notable achievements, such as internet affordability and the idea behind gas-powered vehicles, were a little encouraging. You should check out the story if you haven’t. But if you have read it and wondered how this administration performed in other areas, today’s article is for you. 

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Today's assessment will focus on the Buhari administration's promises for the power sector.

For the scorecard, we will award points for every promise achieved. This means if Buhari and his team promised a 24-hour power supply to Nigerians by 2019, and as of 2019, Nigerians had 24 hours of light, they would get some points (see scorecard below).

But we will take the assessment further by examining how effective these priorities were. Let’s use the electricity example again. If maybe, as of 2019, 50% of Nigerians had 24-hour light every day, that’s still progress. We can award 0.5 points, considering they achieved half of the promise at the set time. We can even be generous with the points if the time elapsed, but reasonable progress has been made at the time of writing.

At the end of the article, we will have a cumulative score and issue a grade using the elementary grading scale. This scale will mean that cumulative points below 64% will be an F.  A score between 65 and 69 will be a D; between 70 and 79 will be a C; 80-89 will be a B, and any score between 90-100 will be an A.

All of the promises we will assess will be from the APC (Nigeria’s leading political party) road map, which shows the activities this administration pledged to prioritise in its last four years of service. Incidentally, this administration has several policy documents, from the Economic Recovery and Growth Plan (ERGP) to the National Development Plan (NDP), which have more robust plans and agendas.

However, this road map was the ruling party’s manifesto for its 2019 elections. Aspiring presidential candidates plan to whip up similar documents as election season nears, so it is essential to understand the current President's approach to fulfilling previous promises.

As you will see, the Buhari administration made promises that were truly important for the development of Nigerians and the growth of our economy.

However, we will only focus on the power infrastructure promises mentioned in the ‘next level’ agenda. There were eight promises, and I’ve distributed scores on each promise. In the end, we should have a cumulative 20 points or 100% score if these promises were all successfully delivered.

The goal of the story is simple. After reading, you should be able to understand the state of affairs when it comes to infrastructure in the power sector, know why these promises matter, and intelligently gauge the impact of whatever pledge future leaders say they will deliver.

Let’s dig in.
 

Promises, promises. Power promises!

When it comes to infrastructure, several things come to mind.

Think about any kind of facility or system that serve a country or city and enables households and firms to function.

Some factors to consider are the elements that make the internet accessible, transportation available, and energy dispensable.

The possible examples are endless.

Thankfully, this administration was very specific regarding the power or energy infrastructure they wanted to deliver. 

On power infrastructure, Nigeria’s president, his vice and members of his party promised several things in four broad categories—generation, distribution, off-grid power, and rural electrification.
 

The first two promises fall under the electricity generation category.

Buhari promised to deliver a minimum of 1,000 megawatts (MW) of new generation incremental power capacity per annum on the grid. He also promised to bring this capacity to a minimum of 11,000 MW. This simply means Nigeria would generate an additional 1,000 megawatts of electricity yearly and clock in at least 11,000MW of generated capacity by the time this administration leaves office.

Now, this promise could have been achieved if we, say, commissioned new generation plants or improved the capacity of the existing ones. In any case, considering that this administration was first elected in 2015, and these promises were from the “Next Level” road map (2019 re-election), one can safely assume that they knew to a large extent what they needed to do to deliver on these promises.

Unfortunately, data from the Nigerian Electricity Regulatory Commission (NERC) shows that the generated capacity has worsened between 2019 and 2021 (a space of two years). On average, electricity sent out by gencos decreased by 263MW  in 2020 and 925MW (nearly equivalent to the projected target) in 2021.
 

So, for the two years, electricity generated relapsed by over 1,000MW,  compared to the 2,000 MW (for 2020 and 2021) we were promised. This performance also rendered the next promise (an achievement of 11,000 MW) unachievable.  Nigeria’s peak generation for the period was in 2019 at over 6,000MW.

The second category of power infrastructure promise is electricity distribution. The government noted that it had an ambitious plan to distribute electricity on a 24/7 basis. There was also the mention of distribution getting to 7,000 MW, roughly double what we currently get, under a distribution expansion programme.

Without presenting the data to validate the performance, Nigerians living inside and outside Nigeria can already guess the scores for this latest set of promises.

But Buhari’s next-level agenda for electricity distribution suggests that people who depend on the national grid for electricity will have light non-stop. However, the Nigerian Living Standard Survey carried out in collaboration with the World Bank in 2020 showed that of the Nigerians connected to the national grid, electricity available was only 6.8 hours per day on average. This finding was based on collated responses from about 22,110 households which cut across the 36 states of the federation.

While it is challenging to estimate Nigeria's electricity demand accurately, some studies have shown that our actual demand is between 8,000MW and 17,000 MW. So, even the 7,000 MW could not have been enough to supply 24/7 electricity to over 90 million Nigerians connected to the grid.

In fairness, the promise was based on revamping and adding new infrastructure under the distribution expansion programme, which was supposed to be partly funded by the German government (Siemens) and the World Bank. And thankfully, as of last week, we learnt that a mega transformer is set for shipping and should arrive in Nigeria before September—fingers crossed.

But today, this promise fails because electricity distribution is still through dilapidated infrastructure, begging for their final resting place.

Let’s be serious. The only Nigerians that can boast of 24/7 electricity are most likely using a combination of several electricity sources—from solar power, inverters, diesel-powered generators or other off-grid means such as dedicated power plants. Most of them have even abandoned their connections to Nigeria’s grid electricity. But what do the statistics say?

One data point for this promise was the first in our latest “shocking data” series on Nigeria. 

As the chart above shows, 90 million Nigerians, about 45% of us, do not even have access to grid electricity in the first place. What’s worse is that for those connected, 78% of them receive less than 12 hours of electricity daily.

How about distribution capacity? Well, there is no way they can deliver what they don’t have. Since the discos distribute what is transmitted from the gencos and electricity generation is still hovering around 5,000 MW, discos won’t be able to distribute electricity beyond the transmitted capacity.

However, the final sets of power infrastructure promises show improved performances. The first promise was to ensure sustainable/renewable energy development by 2019.

There were no definitions for this activity on the road map. But when we think about what this could entail, actions that show an appreciable level of renewable energy, such as solar or wind energy in the country showcase such development.

So, think of initiatives that the Rural Electrification Agency (REA) champions. The agency encourages and supports private organisations to provide power in rural and unserved communities, mainly through solar connections. One of such communities is Rokota village, where PowerGen, a mini-grid developer, was transformed.

Understandably, this administration had nothing to do with the creation of REA. An Act, the Electric Power Sector Reform (EPSR), signed into law by ex-President Obasanjo, which facilitated the privatisation of the National Electric Power Authority (NEPA), is responsible for creating REA. But as you will see in the next promise, the REA has recorded appreciable success even under this administration.

In the next plan under power infrastructure, the government promised that nine universities would have uninterrupted power. So far, the REA has identified five universities that now run on solar energy. The schools are the Federal University of Petroleum, Effurun (FUPRE) in Delta; Abubakar Tafawa Balewa University in Bauchi; Bayero University in Kano; Alex Ekwueme Federal University, Ndufu Alike-Ikwo (FUNAI) in Ebonyi and the Federal University of Agriculture (FUAM) in Benue. 

We can conveniently award half of the maximum score available for this project based on the strategic importance of the project's location—in federal schools located in highly populated regions such as Kano and Benue.  The students, lecturers and other people in the community with this electrification project will hopefully record higher productivity levels if the infrastructure is efficiently managed.

Regarding the final off-grid project, the ambition is to light up 300 clusters and markets such as Sura and Ariaria with clean, uninterrupted off-grid power. But how do we assess this? For instance, one cluster or market could have as many as 40,000 stalls (Ariaria) or 1,000 shops (Sura).

Thankfully, the REA is diligent in recording its progress in these projects. As of the last count, it claims to have connected over 4,000 small businesses and over 11,000 electricity connections through mini-grids. Mini-grids are the common off-grid energy solutions deployed to clusters and markets. 

However, there have been recorded hiccups in these projects.

For instance, the private operators couldn't keep up due to gas shortages, and their billing model wasn't great. According to Stears’ investigation at Ariaria, the operators did not fulfil their promise to install pre-paid meters to allow customers to manage their electricity use. Poor customer service, where customers weren't pre-warned about outages due to gas shortages, also dampened the success of this initiative in the Abia-state-based market.

Still, the implementation of these projects is, at the very least, commendable.

The challenge of having nearly half of the Nigerian population without electricity access is being reduced, albeit slowly. So, even though the REA’s success rate in deploying off-grid electricity is commendable, it will need to move much quicker to receive its full marks.

The last promise on power infrastructure is tied to rural electrification. This administration hoped to execute the Nigeria Electrification Project (NEP). The key word being ‘execute’ involves a $550 million rural electrification programme supported by the World Bank/AfDB to create a pipeline of local private investment and financial incentives to catalyse the Nigerian off-grid market for standalone solar solutions.

How is this going?

There is a similarity between this promise and the off-grid projects. They are all anchored on sustainable and renewable energy. However, the NEP outlines specific projects different from the earlier assessed promises.

Here, the government is meant to execute projects under four components ranging from the solar mini-grids (similar to PowerGen’s initiative for Rokota) to solar home systems. There are also ongoing plans to power up 37 more universities and hospitals in the second phase of the solar energy projects.

The World Bank has a satisfactory appraisal of this project. World Bank provided $350 million, or 64% of the total funds for this project. In addition to the satisfactory appraisal, cooperation from government regulators such as the NERC for permits and licences for mini-grid providers and clear performance-based milestones shows reasonable progress. 

The table below shows the awarded score for each of these eight broad promises on power infrastructure.

Electricity is arguably one of Nigeria’s most significant issues. And going by our earlier established grade scale, the cumulative score of 9.5 points is approximately 50%, below 64%, and therefore an F.  

More importantly, this scorecard pinpoints areas that are struggling to perform well. The categories that stand out include generation and distribution, which we’ve extensively discussed at Stears. However, the Siemen’s deal implementation looks like a game-changer for these categories.

In reality, the pocket of progress recorded in the off-grid and rural electrification is a beacon of hope for the electricity sector and for Nigerians hoping to be free from unpredictable and scarcely available power supply. If rapidly scaled, off-grid solutions can ease the burden on the national grid while conveniently providing power in a manner that is safe for Nigerians' mental and physical health.