FG should review Discos’ performance —Consultancy Dell’Amore CEO, Idris Mohammed

Alhaji Idris Mohammed is the President and Chief Executive Officer of Consultancy Dell’Amore International Limited and former Managing Director, Kaduna Electricity Distribution Company (KEDC). He received a ‘Special Recognition Award’ as one of the top 50 in the world, who have contributed to the promotion of power projects in Africa at the just-concluded 20th anniversary of the Africa Energy Forum (AEF) in Mauritius by the EnergyNet Limited UK. In this interview with OKE PETER, he spoke on the award and the way out of the fluctuating power situation in Nigeria. Excerpts:

Congratulations on your recognition as one of the top 50 in the world, what is the significance of this award to you as a stakeholder in the energy sector?

The significance of this ‘Special Recognition Award’ as far as I’m concerned cannot be over emphasised, for the reason that I have spent over 25 years in the Nigeria’s power sector and close to 10 out of those years, I have been working with international energy stakeholders; who are interested in improving power supply in Nigeria; using the most recent technology solution that is cost-effective.
Also the recognition, coming from an international company that drives investment through conferences and advocacy, EnergyNet Limited, is the leading international investment marketplace for prospective power projects and renewable energy. Honestly, I am happy that my efforts over the years are recognised in the sector.  My first contact with EnergyNet began when I was the Managing Director/Chief Executive Officer of KEDC and power was available 24 hours in almost four states: Zamfara, Kebbi, Kaduna and Sokoto. I was in the office when I received a phone call from the EnergyNet commending me for achieving the feat in Nigeria. Also, sought to know the business strategy I was using to achieve those credible achievements. So for me, I am fulfilled that my contribution to the power sector is recognised during a summit, Africa Energy Forum (AEF), which attracted over 3,000 delegates. I appreciate the award and I will continue to do more for the energy sector.


Despite the Federal Government’s huge spending on the power sector, Nigerians’ electricity demands are not yet met, what do you think are responsible for this?

Well, I want to appreciate the efforts of the Federal Government in making available frequent intervention funds to support Electricity Distribution Companies (Discos) to improve on their service delivery. This is against the background that the government does not need to intervene in the first place because they are private companies; I believe as private companies; they have the financial capabilities to turn around the fortune of their businesses; by ensuring that power is made available to electricity consumers.

Also, the purpose of privatisation you should understand is solely because the sector was not meeting Nigerians’ electricity demand. So when the power sector was privatised, a lot was expected from them and the government had been intervening by making funds available to them to help meet their expectations, but they (Discos) have failed in this regard.

That is to tell you that something is fundamentally wrong. However, what have they been doing with the funds given to them by the government to improve the distribution of electricity? And who is monitoring the intervention funds provided by the government to ensure that it’s judiciously utilised by the Discos for that specific purpose meant for? To be frank, there is no way that the fund utilisation audit will not show whether they have used the funds for the intended purpose or not. And if there is no result, it only means that the government is not taking the right step in ensuring that there is a feedback on the utilisation of these intervention funds given to the Discos to make power available because no result is coming.
Also, for the fact that Discos also know that, even when funds is made available to them, nobody will check its utilisation, for I believe if they know that the government will monitor how the funds is used, they will sit tight. For instance, if you give One Naira for the purchase of meter, and the authority that is in charge of ensuring the utilisation of that One Naira, which is meant for the purchase of meter has done its job, but if nothing is done to check the disbursement, they (Discos) will continue to waste funds. They (Discos) will consider the funds as Christmas gift. Everybody knows that it is freebies. My opinion is that Federal Government is just dashing the owners of distribution companies (Discos) Christmas gift to enjoy. And if anybody wants to prove me wrong on this, they should explain why there have been no checks on how these funds have been disbursed. Another thing is that Discos believe they can hold the government to ransom and it (government) will have no option but to give them funds. If they continue like this, government making funds available without proper checks, Discos will continue to get away with these illegalities.

Recently, there have been blame game between the Federal Government and the electricity distribution companies (Discos) on the fluctuating power situation in the country; to the extent that Discos threatened to quit if the government can refund their funds. Do you think this development is good for the polity and what is the way out?

For me, I will say it is a welcome development; the Federal Government should take advantage of the current situation to do a thorough review of the entire privatisation process. The government should tell Discos who want to quit bringing their performance assessment for a review to see whether they have been able to fulfill all what is contained in the contractual agreement. There were agreements signed by Discos with the Federal Government when they wanted to take over those companies; also, there were terms and conditions given to Discos, that at a certain time, they said they would provide 200,000 meters between the first and second year of operations. Now, the Federal Government should invite Discos to come and give reports on how they have been able to meet this agreement, government should ask Discos, whether they have been able to provide 200,000 meters as promised in that agreement? They (Discos) also promised to reduce distribution loses, let us check, how they have done this as stated in that agreement? In addition, Discos promised to inject foreign capital to support the business, have they brought in that foreign capital that they said they are bringing to improve on the service delivery? Have Discos done that and if they have not done so, within the same period, the government was magnanimous enough to give intervention funds to (Discos) to improve those services, then it is high time the government reviewed terms and conditions of the agreement and performance assessments. Federal Government should also review the income and expenditure of Discos to see whether they have done all what they promised to do to ensuring effective service delivery, and then let us see how the agreement has fared and reexamine the whole process. If they (Discos) say they want to leave, fine, whatever is it that they have not been able to achieve in that contract agreement, whatever the government has given them as intervention should be refunded? For instance, if you have bought the company for $80million and the government has given you $70million as intervention, the funds will be deducted and your balance of $10million will be given back to you.
The government can now take over these companies and decides whether to invest in the sector to improve the service delivery or to hand it over to investors to manage? I know that if the government does not act now, the electricity sector has collapsed, except, if the electricity generation companies (Gencos), which have proven to be doing very well, because from the available records, generation companies are now declaring dividends, which is a welcome development. Because they have invested foreign capital into the companies and it is yielding positive results. Go and find out, if Gencos can bring foreign capital into their operations, why shouldn’t Discos do that? If they have done so, why is it that there is no improvement in the quality of their services? It is high time government took decisive action on Discos.

There are persistent demands for pre-paid meters by the electricity consumers because they believe this will end estimated billing, but Discos are not making pre-paid meters available. Is there any hidden agenda behind this motive by Discos?

I have told you that there was a performance agreement documents signed by Discos when they took over these companies, in that performance contract, there was a full contract on the provision of prepaid meters to electricity customers, what has happened to that agreement? If customers have not been given meters that means the agreement have not been fulfilled, and somebody who supposed to do his job of ensuring that meters are provided by Discos has failed to do his or her job. If the government was magnanimous enough to give Discos intervention funds despites their promises to make meters available to customers; and they are not bringing those meters because they do not want to use their funds to buy meters for customers; and government giving funds to do so and they have failed again; and they are bold enough not to provide those meters; then I believe something is wrong. Apart from that, the game plan of Discos is that they are cheating innocent customers, who have no prepaid meters, therefore, if a customer is being cheated by a service provider, then the law is there and it should take its course, why are they not enforcing the law? Imagine they don’t provide meters and they go on estimated billing and over estimate the customers. It is a crime, let’s apply the law. Do you want to tell me that the government does not know what is going on and that Discos are cheating electricity consumers? What happened to all these intervention funds that the government has given them and the meters were not provided, and if they say they have provided meters, let the government check how many meters they have provided with the intervention funds given to them, then, if they cannot give satisfactory explanation about how the funds were used, then something is wrong somewhere, and government should investigate and take decisive actions appropriately.