Experts back CBN’s interventions in power sector

Experts have thrown their weight behind the Central Bank of Nigeria (CBN) interventions in the power sector

This was even as they expressed concerns over the continuous dependency of the sector on the apex bank seven years after privatisation.

The CBN had constantly provided interventions through loan facilities to boost the electricity supply.

For instance, the apex bank had launched the Power and Aviation Intervention Fund (PAIF), hovering at about N300 billion, Nigerian Electricity Market Stabilisation Facility (NEMSF) at about N213 billion, N140 billion Solar Connection Intervention Facility, over N600 billion tariff shortfall intervention as well as a recent N120 billion intervention designed for mass metering among others.

Similarly, a sum of N600 billion was released for the power sector to bridge shortfall in the payment of monthly invoices by key stakeholders in the sector with another N701 billion CBN facility deployed in March 2017 as Power Assurance Guarantee.

Speaking on the interventions, Wumi Iledare, Professor Emeritus in Petroleum Economics and former President, Nigeria Association for Energy Economics noted that interventions as a repayable loan was understandable, but added that the current structure of the electricity market in the country could mar the interventions.

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Similarly, Associate Director, Energy, Utilities and Resources at PricewaterhouseCoopers, Habeeb Jaiyeola, insisted that providing financial support to industries, especially the power sector, remained a welcome development.

While stressing the need to ensure that the facilities were duly paid back, he said the government’s continued support to the sector will help facilitate the required progress, noting that the Federal Government also has equity ownership in the DisCos.

He urged the authorities to clearly outline and monitor the interventions to ensure it achieved projected objectives, adding that the National Mass Metering Programme for instance may need to be checked against some of its set objectives in terms of coverage, availability, and completion time.

“An assessment of the impact of intervention funding in the power sector also needs to be looked into. While government intervention continues to be an important sector catalyst, monitoring impact will ensure government scarce resources are appropriately channelled for the benefit of Nigerians,” he said.

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Experts back CBN’s interventions in power sector