“The emergence of Interstate Electrics Limited as preferred bidders of the then newly created Eastern Electricity Distribution Company, EEDC started all our problems with electricity supply in the Southeast zone. Trying to re-engage them with our resources after 14 years of mismanagement of electricity supply in our geopolitical zone will amount to courting an unmitigated disaster.” – Engr. Odo Ijere
My Right of Reply to Citizen Ukoha Njoku, the Chief Press Secretary.
My dear brother Ukoha, you started your rejoinder to my article rather badly by referring to my remarks as “skepticism”. As the Chief Press Secretary to the Governor, you are expected to discern the boundary between an advisory remark and a skeptical engagement. Knowing me and where I’m coming from should have told you that mine was just a remark to keep our government properly guided before we commit unintended mistake. You should also be mindful of the fact that some of us will engage the government with the mindset of positive construction as against destructive deconstruction. The important thing is for our inputs to help reshape policy ideation.
You should understand that this issue of purchasing 60% share of EEDC operations in Abia State is one that will impact our collective wellbeing both now and in the foreseeable future. Therefore we should think well and look well before we take the jump.I am happy that my concerns as was very well expressed in my last remarks on the subject matter became a whistle blow that resonated debates across the state to underscore the importance of the issue to the citizens of our state. I have received unprecedented phone calls and supports from all and sundry who believe my remarks were spot on. This also gives us a hindsight and a pointer that the governor must apply extreme caution in his handling of this very delicate issue on the table.
Before I proceed to disarticulate, item by item, the counter narratives painted by the Honourable Chief Press Secretary to the Governor to controvert my innocuous cautionary opinion and advise, i will first open the vista of some background information that will help us understand where I’m coming from and why I believe such investment being contemplated with EEDC’s Interstate Electrics Limited may or will infact not fly at all. All apologies to my friends both in government and out of government.
First, my opinions are buoyed by my professional calling as a consultant electrical engineer that participated in no small measure in building electricity power injection capacities nationwide for the then NEPA in 2001 when Senator Liyel Imoke was SSA to President Obasanjo on Public Utilities. I was then one of the consultants working on the President’s energy transition programs to reform NEPA. Many towns and cities had injection substations upgrading their transformer outputs to cater for growing infrastructures. This happened during the first tenure of OBJ.
A decision was sponsored then in the Senate, to connect all the state capital cities directly to the 132KV/33KV/11KV interswitch national grid platforms. Umuahia which was then receiving supplies via a 33KV line network from Owerri had a 132KV/33KV switchyard substation cited at Ohiya and so was Arochukwu, Amaekpu, Mbalano, Okigwe and Umuahia 132KV/33KV/11KV switchyard substation projects commenced construction with only Umuahia switchyard project at Ohiya attaining completion.
I was there again as consultant when in 2005, NEPA was broken or unbundled into PHCN, 5 generating companies and 11 distribution companies as successor companies. This new structure continued to manage our nationwide generation, transmission and distribution architecture till 2011 when the government of Ebele Goodluck Jonathan finally decided that the government had had enough by opting for outright privatization. I was again consulting for the then General Manager, Southeast zone of PHCN, Engr Akamnonu from Mbaise.
I had a fairly good knowledge of everything that transpired at privatization of the 11 distribution assets of PHCN which included the Southeast Electricity Distribution asset. The emergence of Interstate Electrics Limited as preferred bidders of the then newly created Eastern Electricity Distribution Company, EEDC started all our problems with electricity supply in the Southeast zone. Trying to re-engage them with our resources after 14 years of mismanagement of electricity supply in our geopolitical zone will amount to courting an unmitigated disaster. EEDC was a bad drift to us when they came. We need some rest from them biko.
The owners of the outfit started electricity distribution management business the same day they won the bid at the privatization council. The privatization exercise was just to share Nigeria’s assets to some highly connected political interests and never about to improve power supply in the country. That problem has continued to permeate till this day with the same interests still holding us by the jugular. They are governed only by profit margins and not how to supply much needed electricity. Therefore we should be negotiating how to disengage them from their nefarious hold on our economic progress and not how to re-engage them under a more liberalized sociopolitical and economic environment. Mbanu.
Citizen Ukoha Njoku, to bring a positive change to the electricity supply industry in Abia State is not a rocket science. All we want is for the state government to bend over backwards and consult with home grown experts for the solution. And we have them. The state government does not have to bring in delloitte and Afrexim Bank consultants, the same entities that worked for the failed privatization program that we’re struggling with today, before we can conduct a proper audit of the moribund infrastructure being mismanaged by EEDC in Abia state that produces only darkness. The Ministry of Power and Utilities can carry out the energy audit of the poorly managed EEDC assets across the state or the state can outsource the job to some local consultant engineers which we do not lack to do a proper job valuation.
EEDC and their parent company are looking for the next mugu to start milking their resources. What are we to expect from a company that is run by an Indian as its MD if not to be cheating Nigerians . Abeg we must do better than this. Their Chairman is a multi billionaire in dollars and he flaunted as much before he was approved as a core investor to take over the Southeast Disco with the promise to invest in it and improve on it. So those billions cannot manage a distribution company unless a partner joins him. The best thing is to advise him to sell the business back to Abians or state laws can facilitate a transfer of ownership from him since he can’t manage it.
But since winning the DISCO, he has refused to invest his money to even provide meters for electricity buyers and only resorted to buying power from generation stations and reselling to final consumers through decaying distribution facilities at his disposal. He never thought one day to invest in power generation plants to access cheaper energy. He’s in business not for providing solutions but to keep declaring profits. He’s unsuitable for a struggling state like Abia.
Time has come for Abia state government to domesticate the State Electricity sector laws by taking advantage of its removal from the Federal Exclusive list and encourage EEDC and its sponsors to build a power generating plant in the state. Abia state government will make the worst mistake to partner with this blackhole called EEDC in the networks electricity distribution business.
Interstate Electrics, the owners of EEDC are in a better position to source for a partner or so called investor to spend the money they refused to spend after spending 14 years post privatization without improving their business. We should muster the courage to resist and reject this unwholesome entrapment designed to suck our lean resources where even the Federal Government had made a lucky escape. We are too small to partner with the behemoth that controls Interstate Electrics Limited and EEDC. That’s the plain truth. They should be looking for General Electric or ABB international conglomerates for partnerships not Abia State.
However, in the context of wheeling the excess energy from Geometric to the Umuahia ring fence island being discussed under the state government plan, it may be advisable to negotiate a total buyout of EEDC of those moribund networks in Abia State based on proper evaluation. We have the manpower in the state to manage a brand new power distribution network system.
I will make bold to state that 90% of the entire networks infrastructure under the management of EEDC in Abia state has all exceeded their shelve lifespans. The bare aluminum conductor easily heat up and sag due to expiration of the aluminum products. Concrete poles mostly inherited from PHCN and NEPA collapse at the slightest wind current wave with little or no replacements. Most of the transformers have expired except the ones replaced by communities or other private installations. Most of the transformers has exceeded their insulation limits with vast majority of them well above 30 years whereas they were designed for only about 20 to 25yrs shelve life at the most. These are issues the consultants will help us to unravel before any undertaking could be compelled with EEDC if we must still have to deal with them.
The state may in this circumstance be advised to opt for an outright purchase instead of entering the blackhole or boobytrap provided by EEDC. The state after purchasing 60% shares of EEDC will still be advised to prepare to start replacing those expired moribund networks materials soon after taking over. Whereupon EEDC may begin to overprice themselves and their decayed networks and transformers, it might be advisable to invest our money instead in acquiring brand new networks materials and transformers to run a brand new distribution system in the state than involving ourselves with the blackhole blind partnership. It is difficult to believe that EEDC lack the financial capacity to manage an efficient power distribution network and that the capacity will come when it partners with Abia state. In that case, let us liberalize first to create the enabling atmosphere for other investors not just the state government to price the EEDC shares. Its that simple.
There are enough engineers and manpower with requisite technical experience and knowledge to run a brand new electricity distribution network system in Abia State. Our last estimation is that $25 million USD will buy a brand new network systems to replace entire Umuahia to Ohafia Arochukwu, inclusive of 300 units of 300KVA distribution transformers, 100 units of 500KVA distribution transformers, 5000 concrete poles, 300,000 meters of 100mm and 50mm with assorted line insulators. So how much is it really worth to buyout EEDC? If Enugu state can bypass EEDC, why can’t Abia do the same.
Let me at this point repeat my earlier advise that the state government should, without further delay liberalize our electricity energy supply sector to attract investors in the generation, transmission, and distribution systems. The regulatory laws can put the transmission in one basket to be managed by the State Ministry of Power and Utilities, while the distribution systems can be partitioned into several lots depending on viability and bidded for by investors.
Investors will be attracted to handle the generation systems and sell the power generated to the state government while the investors in the distribution systems may be engaged to manage the partitions created from the Umuahia ring fence island. The Umuahia ring fence island may be further partitioned into three or four smaller islands depending on their feasibility and viability before being presented as lots to investors to manage.
Abia people have been eagerly awaiting for this power sector liberalization program to take off so they can begin to submit their various proposals for investment. I know of two companies that are interested in hydropower energy generation project while another is in solar energy. There’s yet another working on captive CNG generating power conversion and yet one more on biomass thermal energy conversion power system. They all are waiting for the government liberalization of the energy sector and would be greatly discouraged upon hearing that government is investing even nadir in an insolvent company like EEDC.
Please wake up, Citizen Ukoha Njoku, stop sleeping on duty.
Dr. Engr Odo Ijere
