EFFECT OF IMPLEMENTATION OF PRIVATIZATION ON POWER SECTOR FOR QUALITY POWER SUPPLY IN THE FEDERAL CAPITAL TERRITORY (FCT)

Abstract

Reliable electricity supply is critical for economic growth, industrialization, and improved living standards. In Nigeria’s Federal Capital Territory (FCT), Abuja, electricity demand has surged due to rapid urbanization, population growth, and expanding industries. To address long-standing challenges of power instability, Nigeria implemented reforms in its power sector most notably the Electric Power Sector Reform Act (EPSRA) of 2005 and the privatization of the Power Holding Company of Nigeria (PHCN). The main objective of the study is that it examines the effects of the implementation of privatization on power sector for quality power supply in the Federal Capital Territory (FCT). The study utilized both primary and secondary methods of data collection. The theory adopted for this study is the rational choice theory. The relevance of the rational choice theory is that individuals or government perform a cost-benefit analysis to determine whether an option is right for them or not. In this case, privatization of the power sector is the rational choice of the government. The study found that the factors hindering performance of the power sector in ensuring power supply in the Federal Capital Territory among others is generation-related factors such as low generation capacity compared to national demand, gas supply disruptions and pipeline vandalism affecting gas-fired plants, poor maintenance of power plants and limited use of renewable energy (solar, hydro, wind) despite Abuja’s potential. It was recommended that to overcome the factors hindering the performance of the power sector in ensuring power supply in the FCT, the Metre Asset Programme (MAP) should be implemented with immediate effect to ensure customers pre-paid metering and subsequently, nip the problem of billing and high debt profile in the bud. In addition, other challenges such as generation related
factors, transmission constraints, distribution challenges, financial problemsregulatory and policy issues and socio-economic and demographic pressures should be fixed immediately.