Nigerian business tycoon, Tony Elumelu, has urged the federal government to privatize the transmission lines to boost electricity supply and promote economic growth in the country.
Speaking to Bloomberg on Wednesday, Elumelu stated that revamping the electricity sector is critical for revitalizing the ailing economy, urging the government to take action.
He mentioned that the growth of the industry is being hindered by inadequate transmission lines and a shortage of liquidity in the electricity market.
“Even where you generate electricity, the grid cannot take it, so it’s a problem for us.
“Some institutions have idle gas assets or fields. Government should take some of these and let Nigerians who have the resources and means to invest in gas take them. I am advocating that let us privatize transmission lines,” Elumelu said.
Elumelu said that to develop the nation’s vast gas reserves for power generation, President Bola Tinubu’s administration should attract investors and permit the private sector to oversee the transmission lines.
In 2013, Nigeria privatized around 15 state-owned power generators, transferring them to private entities to boost efficiency, while the government-maintained control over the transmission infrastructure.
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However, due to insufficient investment in these transmission assets, they remained inadequate and inefficient for delivering electricity to consumers.
Nigeria currently grapples with poor electricity supply, leading to individuals and companies relying on diesel-fueled generators to run businesses and industries.
The inadequacy in power supply has been attributed to various factors such as low generation of power, insufficiency in gas supply as well as infractions from the distribution companies.
Earlier, the minister of power, Adebayo Adelabu, threatened to revoke the licences of some distribution companies in the country due to the poor supply of electricity.
Elumelu, whose firm’s control 15% of the nation’s electricity generating market, was named one of the economic advisers to President Bola Tinubu a few weeks ago.
He recently also listed one of his power firms, Transcorp Power Ltd., this week at a valuation of $1.2 billion, on the Nigeria stock exchange, a move many believe will increase liquidity in the electricity sector.