Why You Don't Have Electricity & Solutions- A Thread- First point is that money flows/should flow from the electricity distribution companies (Discos) up. @AO1379 @OmoKakafiala @Mochievous @tundefashola @elrufai @modisalihijo @arkazaure @toluogunlesi @EngrSMamman @NaijaFlyingDr

However, due to several challenges, such as electricity theft (people using electricity without paying for same), dated infrastructure, fraud/ connivance of consumers and staff of the Discos, they receive in many cases less than half of the monies due.

Simply put, they get, as an example, N100 worth of electricity from the Gencos via NBET, wheeled by the transmission company and are only able to collect maybe N50, maybe even less. Hence, they can't adequately pay the Gencos who have to, inter alia, pay for gas, operations etc.

They also can't pay other market participants- NBET, transmission company (MO/SO) etc. Those too can't fulfil their obligations. With time, the Gencos can't get gas from gas producers/suppliers as they can't pay for gas. Power generation and supply cease. @izik208 @toluogunlesi

Thus, there are challenges from (a) consumers who steal electricity (b) Discos not providing enough meters (not deploying state of the art technology, not upgrading infrastructure (c) govt's role (poor transmission infrastructure/ MDAs not paying their bills, and NERC (tariffs).

There are also unanswered queries around the privatization, which, in itself, was a laudable feat. We had copied the New Delhi, India Model (to a large extent). Did we see it through properly? Could we have done it differently? Will give my views @MukhtaarTijani @seunsmith

The transmission network had been a major problem too. Last serious enhancement before @tundefashola, I believe was in the year 1987. With population growing in geometric proportions, infrastructure had been left unimproved hence, putting pressure on existing infrastructure.

Generation hasn't been much of a problem, to be honest. If money flows from Discos to Genco and Discos are deemed creditworthy, there will be massive investments in generation, see the NIPPs, as an example. There will also be more investment in gas and gas infrastructure.

In fact, there is a lot of stranded generation capacity & the current govt is doing a lot on gas & gas infrastructure- network code, AKK Pipeline, flare commercialization, amongst others. If Discos can pay, rest assured of massive investments in generation. @toluogunlesi

There is also alot of off-grid support from the private sector, development agencies, state govts (e.g. Lagos State). However, the grid remains critical, as I am of the view that you need grid power to drive true industrialization @MukhtaarTijani @jidesanwoolu @all

Another critical problem is the non-cost reflectivity of electricity tariffs. No one wants to really invest in a business where the cost of producing each unit is higher than the sale price. The use of the concept of sculpting, makes tariffs unviable!

NERC has been doing a reasonably good job and is improving tariffs whilst still being humane, considering rate shock and other factors. Nonetheless, tariffs need to be much higher than they currently are, especially when you consider the unit price of self-geneation.

Some of the Solutions: (1) Make Tariffs Cost Reflective, whilst re-orientating consumers on energy efficiency and savings, retrofitting (changing to CFLs, LEDs etc for lighting) amongst others. Unfair to expect Discos to fulfil licence obligations, without cost-reflective tariffs

Continuing on tatiffs, increases should come with obligations on Discos to ensure loss reductions, via technology, personnel, metering etc. In addition to this, there is the need to disburse the balance of the NEMS Facility to gas suppliers, Gencos and Discos.

Market deficits caused by (some will say political influence) NERC decisions on tariffs around 2015, be paid. Ministries, departments and agencies of the federal government and States should pay their electricity bills and at the right time.

As I had stated in the beginning, if tariffs are not cost-reflective, not collected sufficiently or at all, then over-time electricity will almost not be generated and then supplied along the grid, to consumers. Consumers need to pay and pay the right price.

This is because other participants won't get paid and without funds/ cash, the sector remains comatose. We continue with other solutions as solution will need to be hydra-headed and multi-dimensional. Gas pricing needs to be integtated and well considered, as a key input.

I had mentioned the New Delhi (India) Model, as what we utilized for the privatization (especially for Discos) but India succeeded (we didn't). Why? (1) Indian Regulator ensured Cost-Reflective Tariffs and, (2) govt provided a subsidy regime to cater to rate shock. @toluogunlesi

Not many issues with generation, in fact, the NNPC is looking to develop a gas to power project and there are the NIPPs. Once we have cost-reflective tariffs, Discos reduce Aggregate Technical, Commercial & Collection losses, generation will takeoff @elrufai @MKKyari @arkazaure

To improve generation, gas availability needs to improve. AKK Pipeline be constructed, Escravos-Lagos Pipeline 2 should be completed and the OB3 pipeline connecting Eastern and Western should continue to receive requisite attention. Govt already doing well, here @toluogunlesi

On Transmission, @tundefashola had started a very good job here. Manitona Hydro had massive challenges (not for today). A complete rebuild required of TCN (transmission company). A separate System Operator (which should be independent) and a transmission service provider

Continuing on Transmission, we may transplant here as it may be difficult to privatize this- national security concerns etc. Also private sector not likely to recover for several years considering cost outlay, lead times and recovery period. @EngrSMamman @toluogunlesi

Re: Transmission. First point is to start with the much needed network expansion to accomodate increasing electric power generation in the country. Then create an independent system operator (ISO) from the Transmission Company of Nigeria @toluogunlesi @EngrSMamman @elrufai

Continuing on Transmission. The ISO will be independent & licensed to perform market operation functions. Should be professionally manned should have KPI e.g. capacity recovery and expansion targets. There should also be the creation of the transmission service provider