NERC, MAN team plans elec­tric­ity mi­cro-grid frame­work

Daily Trust - - BUSINESS - By Si­mon Echewo­fun Sun­day

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.

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