Generation Report 2018

Generation

Sent-out generation is critical for the DisCos’ commercial and technical performance.  It is the key factor in determining the availability of electricity supply and its price to consumers in any electricity market. However, the reality for the DisCos, is post-privatization energy wheeled generation that has averaged 3,453 MW, since the November 2013 privatization, and consistently fallen short of the MYTO 2015 generation assumptions that govern the DisCos’ operations and service delivery.

 

During 2018, the daily generation sent-out has averaged an estimated 91,000 MWh (3,791.6 MW).  However, the MYTO-2015 forecast for the year is 203,976 MWh (8,499 MW), which is more than double the reality of electricity supply. This huge deviation has dramatic consequences on NESI, especially, for the DisCos, as their revenue requirement assumptions are impossible to achieve, by just receiving less energy than they are supposed to receive.

 

Since 2015, the compound annual growth rate of the average daily generation sent-out per year has been less than 3%, which indicates that the generation has not increased due to the lack of new generation power plants, gas constraints, water constraints and grid constraints”

 

The inadequate sent-out generation is further worsened by the failure and lack of NERC implementation of six (6) Minor Reviews, to alleviate the energy volumetric risk associated with MYTO 2015 generation assumptions. Correspondingly, the N1.4 trillion market shortfall, partially, but significantly a product of the commercial impact of the generation deficiencies in the MYTO 2015, has limited the DisCos’ ability to put in the necessary investments for network infrastructure expansion, network reliability, metering, customer services, worsening the NESI liquidity crisis.

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