Power Shortages Compounds Nigeria’s Fuel Scarcity Woes-Bloomberg Reports

The deterioration in the electricity supply is due to “very low power generation” by the nation’s power plants, the state-owned Transmission Company of Nigeria, or TCN, said last week.

More than a dozen gas-powered facilities were either not operating or producing limited output at various points during the past two months, it said.

Nigerians are already contending with shortages of gasoline that have resulted in long queues outside filling stations for more than a month since the authorities rejected imported cargoes of the fuel for containing too much methanol.

More than 40% of the country’s approximately 200 million people don’t have access to grid electricity, according to the World Bank. Those that are connected to the grid endure frequent outages forcing them to rely on self-generated backup power with an estimated capacity of 40,000 megawatts.

The generation companies acknowledge they are struggling but attribute their current difficulties to the dilapidation of Nigeria’s transmission infrastructure — the national grid collapsed twice in two days this week — and years of being underpaid for their power. While the electricity plants could produce an average of about 7,100 megawatts between 2016 and 2021, the grid was able to receive less than 3,800 megawatts over the same period, according to the Association of Power Generation Companies, or APGC.

The power stations have lost out on 1.7 trillion naira ($4.1 billion) since 2015 by being unable to dispatch this “stranded capacity,” APGC Executive Secretary Joy Ogaji told reporters on March 13. The state-owned Nigerian Bulk Electricity Trading Co., or NBET, also owes the generation companies “huge sums” for electricity that was sent out to the grid and supplied to customers.

While data about the outstanding arrears owed to the generation firms wasn’t available, Nigeria’s electricity distribution companies paid NBET, which buys power from generating firms and sells it on, less than 30% of invoices worth 730 billion naira in 2020. This leaves NBET unable to remit full payment to its suppliers.

The government transferred most of Nigeria’s generation and distribution assets to private ownership in 2013, while retaining the transmission network and NBET under state control. The country’s privatization agency said last year it would propose the unbundling and sale of the TCN.

Meanwhile, The Premium Times of Nigeria Reports that there are huge fuel shortages in Nigeria.

Fuel scarcity worsened across Nigeria weekend despite repeated assurances from the government that the crisis would soon be over.

Queues persisted in Abuja, Lagos and several other cities throughout last week and early Monday as people scrambled to get petrol for their cars and their electricity generators at a time of rising temperatures.

The crisis, which has lingered for weeks — and in some places like Abuja, for several months — continued despite the federal government saying it has sufficient stock of petroleum products for distribution across the country.

“This experience is too harsh on us. Nigerians are suffering and smiling because if you cry you will be punished, so we are pretending to be happy and we are not happy,” a civil servant at the station who gave her name as Mrs Eze said.

“We are being deprived of what we are supposed to get. I think the reason why the government kept quiet is that everything is easy for them, you can’t see them queuing up like this.”

Nigerians especially in Abuja have endured an unpredictable supply of fuel for nearly a year now, with filling stations operating at reduced capacity.

The crisis started in 2021 after the government announced its plan to remove fuel subsidies. Marketers, who the regulators accuse of hoarding the product, have refused to resume normal operations even after the suspension of the subsidy removal plan.

In February, the federal government said methanol found in recently imported fuel exceeded Nigeria’s specification. The development has resulted in a shortage of petrol and queues reappearing in major cities. It has since spread to all parts of the country.

Traffic gridlocks appeared across major parts of Abuja as many service lanes were closed to traffic due to queues from petrol stations.

The Nigerian National Petroleum Corporation had last month assured Nigerians that the company had placed significant orders of over 2.1 billion litres of methanol-free petroleum to ensure that the long queues end in a few days.

Last week, NNPC again assured Nigerians that it has distributed petroleum products nationwide to resolve the fuel scarcity that has lingered for weeks. Rather than improve, the situation has become worse.

Many motorists have relied on far more costly black market supplies for their fuel needs, and have faced the risks of damaged engines from adulterated products.

People who also spoke with PREMIUM TIMES said the development is undermining the country’s economic activities.

 

During our visits to petrol stations in Abuja on Friday and Saturday, PREMIUM TIMES found that many filling stations remained closed. Those selling petrol were clogged with cars as drivers tried to make their way in.

Filling stations at Banex, Jabi, Wuse and Lugbe areas of Abuja sold petrol at prices ranging from N162 to N200.

Along the expressways, young men clutching petrol cans by the roadsides sold 10 litres of petrol for between N4000 and N5000 in Lugbe, Jabi, and Banex.

Many motorists who spoke with PREMIUM TIMES said they sometimes sleep at filling stations to be able to buy the product.

“I have been here since last night, I slept inside my car so that I can get fuel but still I’m yet to get the product,” a taxi driver, Seun Ogundipe, told PREMIUM TIMES.

“I spent two nights in my house and one night at the fuel station. This is to enable me to get the fuel I need because I can not buy the black market,” he said.

At one of the NNPC outlets in Lugbe Airport Road, there was a huge crowd at the station Friday evening, as motorists struggled to buy petrol.

A taxi driver who was at the NNPC filling station to fuel his car, who identified himself as Akanji, told PREMIUM TIMES that the situation at hand now is a big problem for him because he can no longer feed his family.

“This situation is a big problem for me because I can’t get fuel to work. I’m a taxi driver each day I deliver what I make to the owner of the vehicle. I can no longer feed my family because of this issue.

‘Frustrating and spreading fast’

A civil servant at the station, who identified himself as Moses, said he had been in the queue since 9 a.m. and as of 5 p.m., he was yet to move close to the pump.

“Honestly speaking, the issue has affected me negatively in the sense that I was supposed to be in my office today but because of fuel scarcity I have been in the queue for the past five hours trying to get fuel and until now I have not gotten the fuel,” he said on Friday evening.

“And I must also tell you that it has affected everything, even the food we eat because, by the time you go to the restaurant to eat, you will discover that the plate of food that you normally buy at the rate of N1000 is now N1500 and when you asked them why is like that they we tell you they use the money to transport the foodstuffs from the market to the house.

“It is all-round creating effects on the masses. I must tell you that I am tired of complaining because it is obvious that the government doesn’t know what to do,” he added.

At Optima filling station in Jabi, a commercial driver, Lukas Monday, lamented that frustration is growing in the country where an ongoing fuel shortage is causing disruption of economic activities.

“This is frustrating and it is growing so fast in Nigeria, this fuel scarcity is causing a massive disruption and blackouts,” he said.

 

 

A long queue was also seen at Mobil filling stations, A.A.Rano, AFDIN along Airport Road and Major Oil Jabi. While some fuel stations like Shema, Dan Oil along airport road visited by PREMIUM TIMES were under lock and key as on Saturday morning.

The spokesperson of the NNPC, Garbadeen Muhammed, did not return a phone call seeking his comments as of Friday evening.