Nigerian MDAs to spend N22 billion on generator maintenance in 2023

Some government Ministries, Departments and Agencies (MDAs) in Nigeria will spend an estimated N22 billion on generator maintenance in 2023, a PREMIUM TIMES analysis has shown.

The 22 billion naira will be spent on maintenance and fueling of the generators due to Nigeria’s unstable power supply.

The amount is distributed among more than 200 MDA and is expected to be higher because many agencies did not indicate their generator expenses in the 2023 budget proposal.

Some of the institutions whose budget expenditures on generators were not included in the government’s budget document include the Nigerian National Petroleum Corporation (NNPC), the Federal Internal Revenue Service (FIRS), the Nigerian Customs Service and the Nigerian Communications Commission (NCC), among others.

Nigeria has struggled with poor power supply for decades, often caused by generation and transmission problems. In 2022 alone, the country’s national grid collapsed eight times. To facilitate their operations, private companies and government establishments often rely on alternative sources of electricity, primarily generator sets.

In 2018, President Muhammadu Buhari He stated that Nigerians are less dependent on generators in their homes and businesses. But analysts disagreed with the position as many Nigerians continue to suffer from the domino effect of poor electricity supply.

Nigeria has the lowest access to electricity globally, with around 92 million people out of the country’s 200 million people lacking access to power, according to the Tracking SDG 7 Energy Progress Report 2022.

manufacturers in Nigeria spend at least 3.5 trillion naira looking for alternative sources of energy for their production.

Last June, the World Bank said that Nigeria will need around $100 billion over the next 10 years to meet challenges in its energy sector.

Expense details

According to the details of the budget expenditures of the ministries, departments and agencies, many MDAs are opting for an alternative power supply. The nature of the maintenance that the MDA plans to carry out on the gensets is not immediately clear, but details show that billions of naira would be spent on generators.

The Nigerian Army tops the list of institutions with the largest bids with its budget proposal of N1.1 billion for generator maintenance. A Nigerian army spokesman, Onyema Nwachukwu, did not provide details of the planned spending when contacted in December.

Similarly, the Federal Road Safety Commission will spend N663 million on maintenance of the generator, while the training of the Nigerian Police would spend the sum of N591 million. The Ahmadu Bello University Teaching Hospital budgeted the sum of N303 million, while the National Agency for Food and Drug Administration Control (NAFDAC) would spend the sum of N298 million.

---

The Federal Radio Corporation of Nigeria proposed N238 million; the Economic and Financial Crimes Commission (EFCC) will spend N277.8 million; the Kaduna National Eye Center proposed N230 million; and the Nigerian Navy plans to spend N224 million.

Other big spenders are Umudike Federal University of Agriculture, which budgeted N225 million; the University of Lagos with N218 million; the Nigerian Defense Academy with N211 million; Nigerian Film Corporation with N188 million; while the Comptroller General of the Federation budgeted N160 million.

Failed and wasteful spending

Former Nigerian Electricity Regulatory Commission (NERC) chairman Sam Amadi said the government’s budget allocation for generators means its privatization exercise has failed.

“The fact that the federal government is still budgeting a large amount for the cost of generation and maintenance shows that privatization has not worked as expected. Overall, it is estimated that the government spent around N2 trillion in the power sector after privatization,” he said.

“One of the objectives of the reform is to ensure that the government does not spend more in the electricity sector and channel the savings towards other human development projects,” he said.

He said that the purpose of privatization has been defeated with the continued budget allocations for power generation and distribution, two sectors that have been privatized.

Ijeoma Okereke-Adagba, program officer at the Center for Journalism Innovation and Development, says budget spending on generators is a waste of domestic resources, especially now that the country relies on external sources to finance its budget.

Ms Okereke-Adagba said the government’s focus should be on how to generate revenue to finance the budget and minimize waste.