Nigeria

US partners three Nigerian Discos on energy loss,revenue generation

Power Africa, a US government-led initiative coordinated by the United States Agency for International Development (USAID), has said it helped three electricity distribution companies (Discos) in Nigeria to increase revenue generation by N27 billion in 2017.

USAID attributed the revenue generation feat to efficient technical collaborations with the three utility companies. 

The companies are Eko Electricity Distribution Company (EKEDC), Benin Electricity Distribution Company (BEDC),  and Abuja Electricity Distribution Company (AEDC). 

This was contained in a statement issued Friday, announcing a new partnership recently signed on January 25 with the Ibadan Electricity Distribution Company (IBEDC) to advance the power sector in Nigeria.

“Power Africa initiated similar support to three distribution companies (DISCOs) in Abuja (AEDC), Benin (BEDC), and Lagos (EKEDC) in 2016, with substantial success to date.  

“Aggregate energy losses have been reduced at each DISCO, and revenue collection increased by 27 billion naira ($83 million) in 2017,” the statement read in part.

USAID says it seeks to double electricity access in sub-Saharan Africa, and its Power Africa project will extend technical and managerial support to the Ibadan Electricity Distribution Company (IBEDC).

The effor is aimed at reducing energy losses, increasing revenue, and improving overall performance of the utility company, which provides electricity to five states in the southwestern part of Nigeria.

USAID believes that higher-performing DISCOs contribute to a more robust energy sector in Nigeria by ensuring that power generators are compensated for electricity supply, that generated power is not “lost” or “stranded” by lack of distribution and transmission capacity, and by attracting private investment in new electricity infrastructure.

“Enhancing technical and operational efficiency, reducing losses, and making it easier to collect payment will boost the bottom line at DISCOs, inject cash into the energy value chain, and attract investment for electricity expansion projects that will benefit people and businesses across the country,” Roseann Casey, the Power Africa representative for USAID/Nigeria, said.

Similar to the support to the first three DISCOs, USAID will provide technical support to IBEDC to develop and implement a turnaround plan for the distribution company. 

This work will include oversight of revenue management practices, field inspections to assess the extent to which new practices and procedures are being successfully implemented, and staff training to provide field-based support to utility personnel. 

The partnership between Power Africa and IBEDC was formalized through a Memorandum of Understanding (MOU), which was signed during a ceremony held at the Olusegun Obasanjo Presidential Library in Abeokuta. 

The agreement was signed by Llyr Rowlands, Chief of Party for the Power Africa Transactions and Reforms Program and John Donnachie, Managing Director of IBEDC.

“This agreement heralds the beginning of a mutually beneficial partnership,” said   Donnachie. 

“We appreciate the support we have received from Power Africa, and we look forward to working together to improve operations, to building a healthier electricity value chain, and ultimately to better times for our customers,” he further stated. 

Power Africa’s support to the four distribution companies represents a $12 million investment in the self-reliance and resilience of Nigeria’s energy sector, and demonstrates USAID’s position as the world’s premier international development agency.

Launched in 2013, Power Africa is a U.S. government-led partnership, coordinated by USAID, that leverages the resources of 12 US government agencies and over 150 private and public sector partners to achieve two ambitious targets.

These include expanding access to power across sub-Saharan Africa by 2030 to increase installed generation capacity by 30,000 MW, and to create 60 million new connections. 

Power Africa’s 150 public and private sector partners have committed over $14.5 billion to achieve these goals. 

To date, Power Africa has helped 84 projects comprising over 7,351 MW reach financial close, has helped add over 10 million connections, and is currently tracking over 800 transactions that have the potential to add over 75,000 MW of power.

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