Says firm to prioritise eligible customers, bilateral traders
CHIGOZIE AMADI
The Niger Delta Power Holding Company (NDPHC) at the weekend said that despite the N600 billion owed the company by the Nigeria Bulk Electricity Trading (NBET) and others, as well as 2,000mw ‘stranded power’, it has made an additional contribution of 625mw to the national power grid.
Managing Director of the company, Jennifer Adighije, in a statement in Abuja, also bemoaned the dismal uptake of electricity from the market, saying that it was significantly weighing on the company’s operations.
In the release signed by the Technical Adviser (Media), Adesanya Adejokun, Adighije explained that gas supply challenges, transmission constraints as well as the debt being owed the company were hindering the company’s operations.
She disclosed that the new management has worked to resuscitate five turbine units across Calabar, Omotosho, Sapele and Ihovbor plants that were formerly offline, which now contribute the additional 625mw to the national grid.
“NDPHC currently has mechanically available generation capacity of about 2,000mw that is significantly stranded due to transmission constraints, gas supply and gas transportation limitations in addition to dwindling offtake by the distribution companies (Discos).
“Over the years, the NIPP plants are utilised by the system operator to carry out primary frequency response enabling power grid stability. These ancillary services ought to be monetised in line with the grid code and industry regulations.
“However, NIPP plants are ordered to startup and shut down at the prerogative of the system operator without any form of compensation thus leading to low utilisation of capacity and operational stress on the generating turbine units,” she said.
In accordance with the grid code, Adighije said the NDPHC is placed on restrictions for a number of reasons, including inadequate transmission grid availability, which she said is being seriously addressed by the Minister of Power, Chief Bayo Adelabu, as well as low demand from the downstream electricity market.
“ It is important to note that power generation is driven by demand, and therefore, if the demand isn’t made, the plants will not generate. In certain cases when the demand arises, there is inadequate dispatch corridor or wheeling capacity through the grid network.
“In spite of these limitations, NDPHC continues to spearhead transmission grid expansion plans and distribution network interventions to enable power generation to be delivered to the last mile underserved communities” she stressed.
Since inception of NIPP, NDPHC said it has invested over N500 billion in transmission projects, including transformers, transmission substations, switch gears, switch yards, transmission lines, line bay extensions and several world-class projects currently being operated by the Transmission Company of Nigeria (TCN).
On Alaoji power plant, Adighije noted that a dispute over gas supply metering with the gas supplier led to the shutdown of the station, but that it will become functional again before the end of this year.
She explained that significant steps had been taken to restore the Gas Metering Station (GMS) to provide a lasting solution to gas losses to the plant.
She stated that the company had severally made attempts to enter into a Power Purchase Agreement (PPA) with NBET to no avail, which would have improved NDPHC’s merit order in the dispatch priority schedule. This, it said, has impacted the company very negatively financially and further exacerbates the stranded capacity of the company.
“Currently, NDPHC is placed in the least priority bucket for dispatch in spite of its available daily dispatch capacity of about 2,000mw.
“By no small measure, NDPHC remains the largest fleet of generating turbine units in the sector. Conversely, much of that capacity remains stranded due to these impediments that constrain the company from generating optimally,” she said.
Adighije said the company was leveraging on the order issued by the Nigerian Electricity Regulatory Commission (NERC), on bilateral agreements to sell its stranded power and will soon conclude some deals with off-takers.
Adighije, explained that the company currently has a generation capacity in excess of demand from the national grid, and is thus prioritising direct supply to bilateral and eligible customers to commercialise its stranded capacity.
She reiterated that the strategy of the new management seeks to unlock that stranded energy by dedicating significant portions of it now to eligible customers and bilateral trading arrangements pursuant to the July 25 order of the NERC.
The order, she said, directed generation companies to trade bilaterally with eligible customers, noting that it should be able to address the NDPHC’s stranded capacity.
