Geometric Power: Nigeria power sector set to witness revolution–Afreximbank boss

 

Joseph Irikefe

 

The President and Chairman of the Board of Directors of Afreximbank, Prof Ben Oramah, has said that with the coming on stream of Geometric Power in Aba, the commercial city of Abia State, and with the enabling Electricity Act of 2023, the Nigerian power sector is set to witness a revolution.

Prof Oramah made the prediction at the recent commissioning of the 188MW Aba Independent Power Project, promoted by a former Minister of Power and Robotic Engineer, Prof. Barth Nnaji.

The IPP, otherwise known as Geometric Power was commissioned by Vice President Kashim Shettima and had the Abia State Governor, Alex Otti and captains of industry, the Clergy and leaders of traditional institutions in attendance.

The full speech of Prof Oramah:

I am deeply honoured to have been given the opportunity to address you today at the commissioning of the Aba IPP. Although we are marking this event with a simple ceremony here today, we believe this is a pivotal moment for the development of the power sector in Nigeria. I thank the promoters of this project, in particular, Professor Barth Nnaji, for the opportunity given to the Bank to be part of this momentous occasion.

I recall my first meeting with Professor Barth Nnaji in 2018 where he laid out the vision to me and requested the support of Afreximbank in helping him achieve that vision. We could immediately see the potential of the opportunity not just for Abia State but for the South-East region and Nigeria as a whole. As we fire the first turbine of this remarkable project today, it is our belief that with it, we fire into existence, immense opportunities for the people of Abia State.

It is well understood that Energy is the lifeblood of national development, and this is because energy drives industrialization, powers transportation systems, reduces the cost of doing business for small and medium scale enterprises and lights up our homes and offices. Energy is essential for fostering inclusive growth and reducing poverty. My Sister, Amina Mohammed, Deputy Secretary General of the United Nations, once said and I quote, “Energy is not just a commodity; it is a driver of socio-economic transformation. It powers industries, illuminates homes, and fuels progress.”Regrettably, despite our immense potential in this area with abundant oil, gas, solar and hydro resources as well as years of reforms and investments by succeeding governments, Nigeria has had and still has a long-standing power problem with power supply largely epileptic. This has no doubt had an impact on our quest for development.

The World Bank has estimated that, in order for Nigeria to achieve its goals of nationwide access to electricity for its people, it will require connecting 500,000 to 800,000 households each year. This is an uphill task, but it is doable, and this is not just blind optimism. It is projects like the one we are commissioning today that will make it doable.  I must congratulate President Tinubu for his quick action in this area with the Electricity Act 2023.The Act holds a lot of promise with more active participation of sub-nationals, and it is my hope that implementation will make a difference.

It is because we fully understand the role of energy in national development and also in supporting industrialisation and trade that Afreximbank has committed in excess of $4.6 billion to the power sector across the continent since inception, of which about 20 per cent or $900 million has been in Nigeria alone. Of all the projects we have supported, we are most intrigued about the uniqueness of Aba IPP and its potential as a pacesetter for similar projects across the country.

Aba IPP is unique because as of today, it is the only electricity company in Nigeria that is fully vertically integrated with embedded generation and distribution capacity. The model allows Aba IPP to generate and supply power to its immediate community as a priority before sales of excess power to the National grid. This embedded power generation model strategically ensures constant power supply in the ring-fenced area, regardless of the performance of the National Grid and associated distribution infrastructure.

The end-to-end approach of this model is also worthy of mention. Afreximbank’s financing did not only go to funding the acquisition of Turbines but also to supply and distribution infrastructure, such as a dedicated 27-kilometer gas pipeline ensuring consistent gas supply, construction of 5 new distribution substations, rehabilitation of existing sub-stations in the state and acquisition of collection paraphernalia.

In this regard, I believe the Nigerian power sector is about to witness a revolutionary project, which along with an enabling regulatory framework such as the 2023 Electricity Act, will herald the inclusion of private sector participants. This is because the Aba IPP structure enables the sponsor to control their destiny and avoid transferred inefficiencies from other players. The embedded structure also enables value creation through improved cost management at sourcing level, generation, distribution and collection levels.

As I close, I must commend the steadfastness of Professor Barth Nnaji, without whom, we will not be here today. As you may have heard, this journey started in 2004 and has faced tremendous challenges along the way. Only a person who is truly committed to the cause will have continued with the project to now. Prof Nnaji’s commitment to the project is a source of inspiration to us at Afreximbank and makes us believe that the project will be a huge success.

The Aba IPP depicts the importance of continuity and unity of purpose in governance, as it showcases the contributions of several generation of leaders since 2004, working towards accomplishing meaningful change. My gratitude extends to the Governor of Abia State, His Excellency Dr. Alex Otti, whose visionary leadership has set the stage for conclusion of this transformational journey.

Consistent with the Governor’s five-point agenda, the Bank is meticulously appraising and funding projects that address the challenges of social and economic transformation. For example, in furtherance of the vision to provide cutting-edge communication infrastructure, the sponsors of Aba IPP also proactively installed fiber optic cables on the power transmission lines to facilitate transportation of large data. It is in support of this forward vision and impressive developmental impact that Afreximbank has vowed to stand beside you as a steadfast partner, committed to fostering prosperity in Abia State, using both financial and intellectual capabilities.

The Aba IPP Power Project also underscores what can be achieved when public and private sector stakeholders join forces to impact humanity. It re-emphasizes to us the value of quality leadership and the benefits of building together as a people to pursue the upliftment of our collective welfare.

I would also like to express gratitude to the Federal Government of Nigeria for the granting the opportunity to Professor Bar Nnaji and also for helping address some of the challenges faced along the way.

I would also like to thank all those who have contributed and continue to contribute in diverse ways to make this event a success.

I thank you immensely for your kind attention.

Professor Benedict Oramah,

President and Chairman of the Board of Directors of Afreximbank