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Governors Seek Refund From FG Over $10bn Power Sector Investments
Eko Hot Blog reports that State governors have demanded a full refund of their equity investments in the $10 billion National Integrated Power Projects managed by the Niger Delta Power Holding Company.
Additionally, through the Nigeria Governors’ Forum, the Governors have called for the Federal Government to provide an equitable rate of return on these investments.
These demands were outlined in a document titled ‘Development of the National Integrated Electricity Policy and Strategic Implementation Plan: Policy Recommendations by State Governments,’ submitted to the Federal Ministry of Power.
When contacted, the Federal Ministry of Power confirmed receipt of the document when contacted, but was silent on the demands made by the NGF.
“The investments by states in the NDPHC need to be clearly defined. States advocate for a refund by the Federal Government of the states’ full equity investments in the NIPPs plus an equitable rate of return on their investment.
“The refund of states’ investments in the NIPPs is without prejudice to the ability of the Federal Government to privatise or sell the NIPPs,” the governors stated.
State governments have now been empowered under the Electricity Act 2023 to operate and regulate their own electricity markets outside the control of the Nigerian Electricity Regulatory Commission, an agency of the Federal Government.
NIPPs refer to a government-led initiative launched in 2004 to improve Nigeria’s electricity generation capacity. The NIPPs involved the construction of several gas-powered plants across the country. The goal was to address the nation’s long-standing power shortages.
NIPPs are owned by the federal, state, and Local Governments through the Niger Delta Power Holding Company. The NDPHC is a limited liability company specifically created to manage NIPP assets.
There are currently 10 operational NIPP plants across Nigeria. However, there are plans to build more.
There have been discussions and plans for the privatisation of some NIPP plants. In December 2022, the Federal Government and states agreed to sell five NIPP plants to raise funds.
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