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Here is why Gencos may halt power sector investment plans 

Power Generation Companies (Gencos) may no longer input any investment in the power sector should the current market conditions where it declared generation capacities remain ignored and unpaid. 

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Power Generation Companies (Gencos) may no longer invest in the power sector should the current market conditions where it declared generation capacities remain ignored and unpaid. 

Speaking through their umbrella bodythe Association of Power Generation Companies (APGC)the Gencos maintained that the current market conditions and unpaid debt were discouraging them from investing to expand the power sector production level. 

In a statement made available to felicitate with the Minister of Power, Saleh Mamman, and Minister of State for Power, Goddy Jedy-Agba on their appointment to head the ministry, the Gencos also sought the stability of the country’s power market. 

[READ ALSO: Presco wants to attract forex through its rubber investment]

The statement read, “We wish to put on record that Gencos as patriotic partners with the federal government has exceeded their contractual obligations of recovering lost capacities. The sector can now boast of available capacity of about 8,000MW and installed capacity of about 13,427MW as against an average of 3500MW utilised capacity. 

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“This poor utilisation figure is a huge disincentive to further investments in capacity recovery and installing additional generation capacity, as it makes no sense for a Genco to increase its available generation capacity only to be rejected and hence uncompensated. 

“For gas Gencos, it is double jeopardy as the gas feedstock is on a take-or-pay basis, meaning the Genco must pay for the gas irrespective of the gas being utilised or not as well as finance the cost of making capacity available.” 

Before now, there had been speculation that the Gencos were losing about 6,625 megawatts of electricity and the firms might sue selected agencies of the Federal Government in the sector for “lots of irregularities” in the power industry. 

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Reports also have it that the 6,625MW of energy was not yielding revenue to the Gencos, despite the fact that they supplied a sizable amount of this power to the grid. 

Challenges facing the GencosAccording to a statement signed by APGC’s Executive Secretary, Joy Ogaji Ogaji, the country’s power generation is faced with numerous challenges, and the various challenges facing the Gencos are – liquidity issues, power rejection by the electricity distribution companies and gas constraints due to the state of the market. 

[READ ALSO: Most privatized Nigerian companies are dying]

Famuyiwa Damilare is a trained journalist. He holds a Higher National Diploma (HND) in Mass Communication at the prestigious Nigerian Institute of Journalism (NIJ). Damilare is an innovative and transformational leader with broad-based expertise in journalism and media practice at large. He has explored his proven ability in the areas of reporting, curating and generating contents, creatively establishing social media engagements, and mobile editing of videos. It is safe to say he’s a multimedia journalist.

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Financial Services

NAICOM issues operational licences to 1 reinsurance and 4 insurance companies

Four new insurance firms and one reinsurance company have been issued operational licenses by the National Insurance Commission (NAICOM).

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The National Insurance Commission (NAICOM) has issued operational licences to four new insurance firms and one reinsurance company.

This was disclosed by the NAICOM boss, Mr. Sunday Thomas, while handing over operational licenses to the five firms at the NAICOM Head Office in Abuja today.

The new firms are Heirs Insurance Limited (General); Stanbic IBTC Insurance Limited; Heirs Life Assurance Limited; Enterprise Life Assurance Company Nigeria Limited; and FBS Reinsurance Limited.

According to Mr. Thomas, “The National Insurance Commission (NAICOM) received applications from the under listed companies for registration as Insurance and Reinsurance Companies to transact insurance and reinsurance business in Nigeria. In fulfilment of the statutory provisions of extant laws for the registration/licensing of insurance Companies, the general public is hereby informed that the Commission has commenced the process of registering the companies.”

What you should know

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Heirs Insurance Limited (General) has Mr. Olaniyi Stephen Onifade as its Managing Director; Mr. Akinjide Orimolade, Stanbic IBTC Insurance Limited; Mr. Abah Okoriko, Heirs Life Assurance Limited; and Mrs. Fumilayo Abimbola Omo, Enterprise Life Assurance Company Nigeria Limited.

FBS Reinsurance Limited is to be led by the former Commissioner of Insurance, Fola Daniel, along with other seasoned professionals from the brokerage and underwriting units of the industry like Bala Zakariyau, the former Managing Director of Niger Insurance, Ahmed Olaniyi Salawu of the Standard Insurance Consultants, and Wole Oshin of the Custodian Investment Plc.

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Economy & Politics

Nigeria edges closer to getting World Bank loan, in the final stages of talk

The Finance Minister has disclosed that Nigeria has fulfilled the conditions and is in the last stages of securing a World Bank loan.

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FG projects spending plan of N11.86 trillion and deficit of N5.16 trillion,IMF, International monetary fund, Zainab Ahmed, Nigeria's Minister of Finance, Budget and National Planning

Nigeria is set to achieve its plans of getting the $1.5 billion World Bank loan package as it is in the closing stages of the deal following its fulfilment of the conditions set by the international multilateral organization.

This disclosure was made by the Minister for Finance, Budget and National Planning, Zainab Ahmed, during an interview on Friday, November 27, 2020, with Bloomberg Television.

While pointing out that Nigeria’s senate approved the borrowing plan from the World Bank in June, Ahmed said the board of the multilateral institution will discuss the loan package at their next meeting.

What you should know

It can be recalled that the World Bank loan which had been sought by Nigeria in the wake of the devastating impact of the coronavirus pandemic, was being delayed by the Brettonwood institution due to concerns over reforms as it feels that Nigeria has not shown enough commitment towards achieving them.

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Some of the reforms include the unification and flexibility of the exchange rate, removal of fuel subsidy, increase in electricity tariffs amongst others.

However, it seems that with the recent deregulation of the downstream sector of the oil industry with the attendant removal of fuel subsidy and increase in electricity tariff, some of those concerns of the World Bank are gradually being sorted out.

Ahmed also said that Nigeria is considering joining the G-20 debt-relief initiative and is talking to commercial lenders to secure their backing.

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She said, “We will consider joining as long as it is safe for us to do so. Nigeria couldn’t participate initially because some of the conditions were unfavourable for existing loan commitments with bilateral lenders and other international borrowings.”

On the increased gap between the official rate and parallel market rate, the minister said the government is concerned about the widening gap in the naira’s exchange rate on the official and parallel markets.

She said, “We have been taking measures to close the gap. We hope to get to an even level very soon so the impact of the exchange rate will become moderated.”

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Coronavirus

Covid-19: Africa prepared for possible second wave – Africa CDC

Africa CDC has confirmed its preparedness for the possibility of a second wave of COVID-19 pandemic in Africa.

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Covid-19: African Union in talks with China and Russia over vaccine

The Africa Centres for Disease Control and Prevention has confirmed its preparedness for the possibility of a second wave of COVID-19 pandemic in Africa, especially with the current upsurge of active cases.

This disclosure was made by the Director, Africa CDC, Dr. John Nkengasong, during the teleconference Weekly Press Briefing on #COVID-19 on November 26, 2020.

According to him, Africa CDC has started to distribute 2.7 million rapid antigen tests with the hope that by mid-2021, the health officials would have been able to vaccinate about 60% of the continent’s population with one of the several promising new vaccines — it all depends on the cooperation and support of the continent’s leaders.

(READ MORE: Reps Committee warns MDAs against failure to render accounts to Auditor-General)

What they are saying

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According to Dr. Nkengasong: To achieve 60% vaccination, we will need to mobilise up to about $10 to $12 billion, including the cost of buying the vaccines and the cost of delivering the vaccines. So, that is the 60% mark that we really want to achieve. And I just really want everyone on this platform and our partners to understand that as a continent, that is our aspiration and goal.”

As the end-of-year holidays are around the corner, Dr. Nkengasong advised: “Do not relent in wearing masks. One message that is emerging across the visits we are conducting across the continent is that people are not masking enough. And in some settings, absolutely it seems like they are not masking at all. And that is extremely dangerous.”

What you should know

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  • As of November 26, 2020, Africa had 2,106,931 confirmed caseloads, with a death toll of 50,628 and 1,781,744 persons recovered.
  • The Southern African region is the worst hit both in terms of the number of confirmed positive cases and deaths.
  • South Africa, Morocco, Egypt, and Ethiopia are the most affected countries in terms of number of positive cases.
  • South Africa is presently the worst hit with active cases of 775,502.

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