Reversal of privatisation not solution to power sector, say Discos

The Association of Nigerian Electricity Distributors (ANED) has faulted the call for the reversal of the privatisation of the power sector.  

Aliko Dangote, billionaire businessman, made the call while speaking at the Senior Executive Course 38, at the National Institute of Policy and Strategic Studies (NIPSS), Kuru, Plateau state.

Dangote said some of the people who bought power assets do not have an understanding of it.

He advised the government to negotiate with them and find solutions to the problems confronting the sector.

“We should be as open as we can if government doesn’t intervene by taking back these assets and giving them to people who really have money that they can really inject, we will not be able to deliver on power,” he had said.

But the discos said they have been doing their best, and that there can be no “overnight” solution to a sector that had been mismanaged for over 63 years.

“Anyone who has followed the privatisation of the Nigerian Electricity Supply Industry (NESI) would recognise that the sector has been bedevilled by a number of challenges that would make the most hardened risk-seeking investor to run in the opposite direction,” they said in a statement.

“All of this on the back of approximately 63 years of a failed centralized public management of the power sector.

“If the GenCo and DisCo investors are to be accused of anything, it is that they believed in their country and had a strong desire to put their money at risk, behind that belief, rather than those who may be considered nothing more than armchair experts, with a reluctance to dip their toes in the water.

“In fairness, we note that Alhaji Dangote’s company did put in a bid during the privatisation, but his bid was delivered late, after the bid deadline, and was rejected.”

They claimed that the privatisation exercise was “universally deemed to be one of the fairest and transparent” of its kind.

The Discos acknowledged that a lot needs to be done, but said reviewing the policy could turn Nigeria into an “investment pariah”.

“Indeed, any such plan by the government risks subjecting the nation to becoming an investment pariah,” they said.

“In this dire economic times, in which we are seeking Foreign Direct Investment (FDI), do we really want to send a message to the investment community, both local and international, that the federal government of Nigeria (FGN) does not respect its contract nor is it interested in building an enabling environment for private investment?  Furthermore, is the government prepared to, in these very difficult economic times, refund over $5 billion to the investors?

“As well as deal with the consequences of any resultant litigation and world-wide condemnation.

“We do not believe that a reversal of the privatization is the solution to the current challenges of the sector.”