Peter Ikenga, the Managing Director/Chief Executive Officer of Transcorp Power Plc, highlighted that the challenge lies with Nigerian power distribution companies’ inability to effectively distribute the electricity generated, leading to the need for exporting it to neighboring countries.
During a virtual presentation of Transcorp Power’s year 2023 results, Ikenga revealed that 18% of the company’s earnings in the previous year came from electricity export.
Responding to inquiries about why they were exporting energy while the country faces power shortages, Ikenga pointed out that the distribution companies were failing to absorb the power generated by Transcorp Power, resulting in what he termed as stranded capacity.
He explained that due to excess power generation compared to local demand and constraints in the grid, they had surplus energy which local distribution companies were unable to utilize, necessitating the export to West African nations.
Ikenga emphasized, “Our objective is to optimize power generation from the plant, and due to sector challenges, we often produce more electricity than the local demand can accommodate due to grid limitations.”
He elaborated, “When distribution companies cannot take the generated load, leading to stranded capacity within the plant, and if this excess capacity cannot be utilized locally, we explore markets outside the country. Therefore, our export primarily includes power that would have gone unused locally.”
Ikenga noted that Nigeria’s power sector faces structural issues, contributing to the prevailing darkness and emphasized that Transcorp would not allow low local demand to impede its capacity utilization.
He stated, “The darkness in Nigeria is a structural challenge in the sector. However, as responsible business owners, we aim to maximize our available capacity despite local demand. Cross-border sales enable us to optimize our plant’s capacity.”
NewsNow reported the Minister of Power, Adebayo Adelabu’s recent pledge to increase power generation from 4,000MW to 6,000MW within six months.
Despite concerns about the ability of the 11 power-generating companies to distribute 6,000MW due to infrastructural deficiencies, Adelabu reassured Nigerians that the planned power increase would be effectively transmitted and distributed.