NERC, MAN team plans electricity micro-grid framework
The Nigerian Electricity Regulatory Commission (NERC) is teaming up with the Manufacturers Association of Nigeria (MAN) to develop a work plan on having a micro grid that would guarantee direct power supply to industrial clusters nationwide.
Inaugurating the technical team yesterday in Abuja, NERC Chairman, Dr. Sam Amadi said the innovation stemmed from the need to support industrialization by increasing energy supply to industries, thereby cutting the cost of using alternative fuel energy.
He said energy (mostly generators) costs account for 40 percent production cost at present in Nigeria but such move would have a far-reaching effect on reducing the cost of doing business and encouraging the much needed industrialization. The Commission early this year began critical campaign for off-grid energy to expand power supply to rural areas while canvassing for embedded power generation that allows Distribution companies (Discos) to have more electricity to distribute.
He said, “A few months ago, we thought about how to support industrialization by increasing energy supply to industries, thereby reducing the cost of doing business. I do know that energy cost accounts for 40 per cent of cost production, which is a huge drag on profitability, industrial capacity as well as global competitiveness of Nigerian manufacturers.
“NERC has always thought about how we could unleash the industrial potentials by solving the power supply needs of the industries. We established the embedded generation regulation, the independent distribution network regulation and the independent transmission network regulation. And towards the end of last year we started thinking of how we can innovate in these regulations to help industrial clusters,” Amadi said.
The President of MAN, Dr. Frank Udemba Jacobs in his charge said, “Power constitutes 40 per cent of our cost of production and, therefore, any initiative or innovation that will assist us in reducing this amount will be highly welcomed. What we are doing today is simply to inaugurate the committee.”
He said the committee will converge in Abuja next week and work for another week to develop the plan document. “The earlier this document, the better, so we can engage the federal government and the Presidency to push it through,” he said
Terms of reference for the committee include developing policy and regulatory framework for viable micro-grid for industrial clusters, developing the business models for prioritizing financial viability, identifying relevant stakeholders, and evacuating agreement and purchase obligation.