The Federal Government has given an indication that it would soon review the privatisation of power plants in the country to enable government restructure their ownership and capacity to deliver value to the people.
This is to ensure that owners who do not demonstrate sufficient capacity to operate the facilities cede their stakes to new investors.
President Buhari, who was represented by the Minister of State for Budget and National Planning, Zainab Ahmed, said the government’s aim of doing this is was to open up the power sector for new investors to bring in fresh capital to make the power plants more functional.
He disclosed that negotiations would begin with power generation companies, DISCOs, in areas where the country is having the most difficulties in ensuring adequate power supply.
The Vice President, Yemi Osinbajo, at the opening session of the summit, had rejected a proposal by one of the operators who urged the federal government to inject more money in the power plants sold to private investors.
Instead of giving fresh funding, Mr. Osinbajo said, present owners of those companies who have no capacity to fund their operations should transfer their equity to new investors to help realize that objective.
The Chairman, Transcorp Ughelli Power Limited, Tony Elumelu, had urged the federal government to reconsider refinancing the electricity distribution companies, DISCos by acquiring fresh shares of the firms.
Mr. Elumelu had said injecting fresh capital would check the current situation where operators of these power plants were holding the government to ransom with endless demands.
Elumelu advised the government to increase their investment in the sector, scaling up ownership from 51% to 60% and divest to capable investors (Discos) who have the financial muscle and expertise to run these businesses.
Noting that some investments in DisCos have been highly leveraged, Elumelu said that the selection process should be very strict, allowing for new ownership structures.
“We need to do more in the electricity sector. Ownership structure should change without affecting the property rights of investors,” he said.
“If the power sector is fixed, the economy will take off.”