How a new policy could boost the 5,000 MW grid and reduce system collapse
More energy, crucial reforms – Experts
As power consumers in Nigeria are worried about a trend of power system collapse with four already this year, the government and power sector operators are rapidly coming up with a new approach that should anchor a network of 5,000 megawatts (MW) in the short term to stem this threat.
Daily Trust spoke to electricity experts, officials from the Generation Company (GenCo), the Transmission Company of Nigeria (TCN), the Nigerian Electricity Regulatory Commission (NERC) and obtained documents on how this policy could work and save a struggling electricity sector.
Why the Nigerian system often breaks down
In the field of electricity market, there are three stages of stability on the national grid system. It could be stable, marginally stable and unstable, said engineer Dahiru Ahmad, a senior power substation manager.
In recent times, the national power grid has plunged into a state of emergency, still causing alerts due to the liquidity crisis affecting power generation. Engr Ahmad said that in this state of emergency, TCN, which is the network manager, has a huge job of managing high and low frequencies.
“Normally in a grid system like the US or UK, with high power generation, TCN won’t have this challenge because, as it’s called in technical parlance, stiffness is the key. The more generators running on a grid, the more stable the system will be. But for Nigeria, the reverse is happening,” he said.
According to EIA.gov, a US energy tracker, at the end of 2021, the US had a total power generation capacity of 1,143,757 MW. Continuing, Ahmad said, “For example, in the United States where power generation is over 100,000 MW, once the generators or turbines of say 1,000 MW stop working in a GenCo, it doesn’t will not affect the grid, but in Nigeria where peak generation barely rises above 5,000 MW, when 1,000 MW drops from the Nigerian system, it is huge and can shake the system, which could cause a collapse partial or total system.
“TCN is not the generator of electricity; it is only a transporter of electricity from the GenCos to the distribution companies (DisCos), which means that if the energy generated is low or high, TCN will evacuate the same quantum to the DisCos for further supply end users. explains the system operations expert.
Shortly after June 12, 2022, when a national grid collapse plunged Nigeria into a dark night, engineer Emmanuel Okon, a GenCo operator, said that once the power station frequency monitor, sub – transmission stations and distribution substations display 50.5 hertz (Hz ) and above, it means there is high voltage and the network may shut down if the DisCos fail to increase quickly the power supply to consumers at this point.
The official also said that if the frequency drops to 49Hz or lower, it means the GenCos are not generating enough power to meet the demands. At this point, the network will shake and fall into an emergency state. If you are in one of the GenCo, TCN or DisCo control rooms, you should hear the alarm go off, putting staff on alert in the event of a probable collapse.
“What TCN is doing at its National Control Center (NCC) in Osogbo is calling for more GenCos to be generated. However, if these GenCos do not have enough gas, there is little or nothing TCN can do to avoid collapse; and if the voltage is high, TCN calls DisCos to take more loads and if they refuse or their network has problems, the system may crash; it’s so delicate.
“So the best thing is to have more GenCos in operation and to have DisCos with enough grid capacity to supply electricity to consumers. And you can’t blame the GenCos if they don’t have not enough electricity market funds to pay for gas,” said Engr Okon.
NERC to the rescue with a contractual policy
Just on July 1, NERC declared that a major policy shift in the annals of the Nigerian Electricity Supply Industry (NESI) had occurred. For the first time, the regulator has decided to hold operators accountable by ensuring that they sign performance contracts throughout the value chain.
NERC even went ahead to support a bold reshuffle of five DisCos in what is described as the most powerful ball since the privatization of the electricity sector in 2013 in an electricity market marred by illiquidity. .
Speaking on these issues, a NERC official confirmed the acute liquidity crunch, noting that this was why NERC proposed contract-based power administration where GenCos, TCN and DisCos are bound by contract and must perform or face penalties.
According to a NERC New Contractual System Implementation Report, the average electrical insurance is expected to be 5,000 megawatt hours (MWH). Based on this, none of the 11 DisCos are expected to have at least 70% of their grid allocation each day, which is a guarantee to increase the power supply for the more than 10 million registered electricity consumers in Nigeria. . But the official noted that the 5,000 MWH/H may not be achieved immediately, just as he insisted on applying a consistency model that will improve performance against the set target.
Regarding the sanctioning of defaulters, NERC had to activate the business continuity model to restructure the worst performing DisCos. While Fidelity Bank took over management of Benin, Kaduna and Kano DisCos last week, NERC and the Bureau of Public Enterprise (BPE) restructured Ibadan and Port Harcourt DisCos. These five DisCos now have reformed boards and managements, which are supposed to breathe new life into the utility companies in this dispensation.
Regarding the resolution of the operators’ liquidity problems expressed shortly before the signing of the contractual agreement which was activated on July 1, the regulator’s source said that NERC was working with the CBN to tap into a liquidity stabilization fund. electricity emergency which will increase the ability of DisCos to pay. for monthly energy bills.
“The GenCos will now have more funds to increase the gas supply to their power plants and improve the production of energy to be transmitted by TCN. As things stand, TCN does not have a problem yet because it can generate up to 5,000 MW. The commission is also considering a spinning reserve mechanism for them which is part of the ongoing transmission expansion master plan which they have been asked to submit to NERC for approval,” noted the manager.
He said the spinning reserve will ensure that there is a standby turbine at a GenCo, preferably one of the three hydroelectric plants, so that in the event of a frequency disturbance, that turbine can be called upon immediately in the network to prevent a system crash. However, the official noted that if the contract-based market works as expected, the spinning reserve will not be needed as the grid will have at least 4,000 MW or more available every day.
More funds, more energy can curb network collapse – Experts
More and more experts have expressed their support for what the government and operators can do to improve the functioning of the electricity sector.
According to the Convener, Nigerian Power Consumers Forum (NPCF), Mr. Michael Okoh, who was reacting to the recent takeover of three DisCos and a reshuffle of the others, since the intervention of the Central Bank of Nigeria (CBN) by sequestering the DisCos’, the management of these DisCos would have devised a way to under-report the discounts.
He said they are paying the supposed sum they would have collected from consumers each month into the CBN fund from which the CBN allows them to pay salaries and other expenses before they can now pay for the bulk energy that they receive. is supplied by the GenCos through the Nigerian Bulk Electricity. Trading PLC (NBET).
Okoh said, “That’s why they brazenly pay less than 40% of GenCos’ monthly energy bills and who knows if they get more than that from consumers. This operation is good but it is not based on a contract and therefore they have a window to under-report everything they collect from consumers. So I believe that if NERC is strict with the contract-based electricity market, DisCos should be held accountable to pay the energy bills they receive, and be penalized if they fail and they should supply consumers.
Mr. Okoh further absolved TCN of any blame saying that the company can only be blamed for the fragile transmission of the grid if the system begins to collapse when power generation peaks at 5,000 MW.
Regarding the reforms of DisCos, the chairman of the Nigerian Consumer Protection Network (NCPN), Kunle Olubiyo, said that electricity consumers applauded the measures taken by the NERC and the BPE, but criticized the authorities for not having carried out a major review five years after the start of the privatization of the electricity sector.
“Under the current circumstances, we are on the same page as relevant stakeholders in the current effort to clean up the mess and free the economy held by its jugular by Non Performing Utilities (NPU),” Olubiyo said.
For his part, Professor Yemi Oke, a power systems specialist and prominent NESI figure, said that 80% of DisCos are technically insolvent, hence the power sector problems that may persist.
He said: “We are in a deep and serious crisis with regard to the energy sector (oil, gas and electricity). All my points on the challenges of the electricity sector remain matters of national imperative.
Professor Oke said that unless these issues are addressed, including a complete overhaul of other DisCos beyond the five DisCos already affected, “We will continue to experience an average of five to six national grid system collapses per year. “
There may be a return to date of the policy. Analysis of network data indicates that the network is gradually recovering from the abyssal state it was in a month ago after the major system collapse. From 3,000 MW of peak generation on July 1, the grid gradually increased to reach 4,102 MW on July 8 before a slight drop to 3,992 MW on Saturday.
As of Sunday, the grid system had a capacity of around 3,908 MW (6 a.m.) with 21 GenCos in operation and it is expected that this policy will help the more than 10 million consumers to obtain better guaranteed electricity for their homes and industries.