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HomeBusinessManufacturers seek recapitalisation of Electricity distribution firms

Manufacturers seek recapitalisation of Electricity distribution firms

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The Manufacturers Association of Nigeria (MAN) has called for urgent review of the capital base of Power Distribution Companies (DisCO) to address liquidity issues in the sector.

According to the Chairman,  Basic Metal Fabricated Iron and Steel Products  Manufacturers, a sectoral arm of MAN, Kamoru Yusuf, more funding for the sector would increase investment in network end challenge of paucity of funds hurting the sector.

In a report entitled: Nigeria’s Power sector and the way forward, Yusuf explained that over the years, DisCos have lamented the paucity of funds in the sector.

He said there was need to invest more in DisCos infrastructure most of which are weak, obsolete, and overdue for overhaul.

“Despite the intervention by government and international organisations, the state of DisCos infrastructure remains a far-cry from the expected. The decades of appalling performance of the Nigerian Electricity Supply Industry (NESI) have left many Nigerians wondering if NESI could ever be remedied seeing that the role of NESI in the state of Nigeria’s economy cannot be over-emphasised,” he said

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Yusuf disclosed that from the several households scattered across Nigeria, through the Small and Medium Enterprises to the large electricity consumer in the manufacturing sector, a turnaround of NESI will positively impact the very fabric of Nigeria. This is because virtually all business need electricity to thrive.

He said despite the plethora of interventions from several quarters – national and even international, there has yet to yield much benefits as the sector is clearly enmeshed in avoidable chaos.

“One would have expected that the advent of the Electric Power Sector Reform Act 2005 (ESPR) and the laudable innovations thereunder would usher in respite to Nigerians, but their hope has been dashed as the desired changes and impact have yet to materialize of the last 16 years.

It is, however, clear that beyond the mysticism that has characterised the possibility for an effective NESI, a cursory look at the Power Sector in other nations of the world reveals that there are huge learnings to glean from them.

He noted that a vibrant and efficient NESI is possible if only all hands are on deck to achieve same.

It is pertinent to state at this juncture that whilst the value chain NESI comprises Generation Companies (GenCos), Nigerian Bulk Trader (NBET), Transmission Company of Nigeria (TCN) and the Distribution Companies (DisCos), the DisCos are central to the effectiveness of the NESI being the bridge between the customers and the value chain.

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