The Minister of Power, Adebayo Adelabu, has justified why the Mambilla Power project did not get any allocation in the ministry’s 2024 budget proposal.
Speaking during a session with a joint committee of the Senate and House of Representatives Committee on Power chaired by Senator Enyinnaya Abaribe, Adelabu said legal disputes had continued to rock the Mambilla project. As such, he said he did not allocate any amount for the project
Sunrise Power and Transmission Company Limited had on October 10, 2017 dragged the Federal Government to the International Court of Arbitration administered by the International Chamber of Commerce, Paris, France for alleged breach of contract in relation to a 2003 agreement to construct the 3,050MW plant in Mambilla, Taraba State, on a Build, Operate and Transfer basis for $6bn.
The Federal Government, in its defence, insisted the contract award was irregular and did not pass through due process.
However, Adelabu told the senators and members of the House of Representatives that he deliberately removed the Mambilla project from the ministry’s 2024 budget proposal.
He said, “For Mambilla, there is no provision for it in 2024. It isn’t a mistake. It is deliberate. It is under international arbitration. Until it is resolved, we can’t do anything about it.”
Speaking on the Zungeru hydropower project, the minister said it was almost completed.
“The hydropower plant is 99.8 per cent ready. It is almost completed and we intend to start operation this year and commence evacuation to the national grid. Immediately concessionary fees are paid, we will start full operation. So, we don’t have problem with Zungeru.”
Located in Niger State, the hydroelectricity power plant is a 700MW power station.
According to Adelabu, the biggest challenge facing the power sector is not generation, but distribution, explaining that part of the power generated is lost in the process of distribution.
He attributed the problem to the distance between the spot of generation to the distribution network. He maintained that the facilities of the existing power distribution companies were obsolete and needed to be upgraded.
He said, “In the process of transmission to distribution, we lose power because of the distance of travel. You lose close to 40 per cent when you move from area of transmission to distribution.
“The existing Distribution Companies, (Discos) aren’t doing new investment to change their old facilities to new ones. When you lose 40 per cent to evacuation, it is a big loss. So we need to have enormous investment in the distribution chain.
“What we are trying to do going forward, is to expand our transmission facilities . Within the next two years, there must be improvement.”
Giving further explanation on the predicament over distribution of power, Honourable Adelabu restated his call for the unbundling of the distribution companies.
“The government can take responsibility for transmission because it is fully owned. But when it comes to distribution, the states must be involved. The DISCOS must be closely monitored by states. My proposal is that they must be unbundled. The states must be involved when it comes to distribution. Even when it comes to transmission lines, the states are well placed to secure the right of ways for us.”
In his closing remarks, Abaribe commended the minister for what he called his detailed understanding of development in the power sector.
“For someone not in the power industry, you seem to have a grasp of the issues. We shall look at your budget and see how we can work with you, but we need to see three years summary of your budget performance.”
