Stakeholders to BPE: can winners of PHCN firms deliver?

PHCN Stakeholders in the power sector have called on the Bureau of Public Enterprises (BPE) and the National Council on Privatisation (NCP) to ensure that bidders who emerged winners in the power sector privatisation process are able to deliver electricity to Nigerians.

The stakeholders, said it is not enough to emerge a winner, stressing that what is needed is the capacity to deliver uninterrupted power supply to Nigerians.

“We are sure that any credible bidder will be pleased to present its plans on how it intends to achieve the promise it has made in its proposals. This is very important. What Nigerians want is available power on a consistent basis, not unachievable plans designed only to win competitive bids that result in no change,” a major player in the power sector whose campany lost out in the bid process said.

“It is also important that the Nigeria Electricity Regulatory Commission (NERC) discharges its statutory duties to ensure that the distribution companies are financeable and financially stable on a sustainable basis,” he added.

Another active private sector player, who also pleaded not to be named, declared: “As was indicated by the Chairman of the NCP Technical Sub-committee, this is not the end of the process. Commercial offers of bidder must be feasible based on the Technical Proposal submitted. This must ensure that the bidders are being consistent and that they can deliver their proposals.”

The way to determine this, he stated, is by looking at the pedigree of firms that submitted bids and not necessarily the figures quoted by them.

They also urged the Federal Government and BPE to ensure that the bids announcing the winners are consistent with the business plans submitted by bidders and that they are feasible, so that investors and lenders would be able to commit their capital to the Distribution Companies (DisCos) with confidence.

The concerned stakeholders cautioned that Nigerians would not be happy if poorly performing publicly owned utilities, become poorly managed privately owned companies, neither will it be desirable that a few years down the line, these successor private sector companies run into financial bad weather or are used to fleece power consumers through higher charge-out rates beyond the Multi-Year Tariff Order (MYTO) tariffs.

However, the stakeholders commended the transparent and professional manner the exercise was conducted, saying the process has inspired confidence in investors and the public alike.

The 10 electricity distribution companies that were sold include Abuja, Benin, Eko, Enugu, Ibadan, Ikeja, Jos, Kano, Port Harcourt, and Yola. The Kaduna Electricity Distribution Company couldn’t get a qualified bidder.

For the other companies that have more than a bidder, the bidders with the highest Aggregate Tecnical Commercial and Collection (ATC&C) loss reduction levels, stand a better chance of emerging preferred bidder, except if other factors are considered, the Chairman, Technical Committee, National Council on Privatization (NCP), Mr. Atedo Peterside said.

The companies selected for the four Discos with single bidders, are Aura Energy Limited, Sahelian Power SPV Limited, 4Power Consortium and Integrated Energy Distribution & Marketing Limited.

Except otherwise indicated, companies with the highest percentage ATC&C losses reduction will emerge preferred bidders.

If this happens, Integrated Energy Distribution & Marketing Limited, will emerge preferred bidder for four distribution companies – Eko, Ibadan, Ikeja and Yola, while Emeka Ofor’s Interstate Electrics Limited will emerge the buyer of Enugu and Abuja Electricity Distribution Company and Gbolade Osibodu’s Vigeo Power Consortium, could clinch Benin Distribution Company.

The Nation

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