The Nigerian Bulk Electricity Trading Plc (NBET) and Energy Exchange Instabul (EXIST), a Turkish agency, have signed an agreement on cooperation to help Nigeria improve commercial transactions and revenue collections in the country’s power sector through cutting edge technologies with attendant investment inflows into the sector.
The Memorandum of Understanding (MoU) signed between the two agencies at EXIST’s campus in Maslak, Turkey to boost cooperation and knowledge exchange between the two countries was designed to explore mutually beneficial opportunities for growth between NBET and EXIST.
The signing ceremony was witnessed by the Nigerian Minister of Finance and Chairman of NBET Board of Directors, Zainab Ahmed; Chief Executive Officer of NBET, Dr. Nnaemeka Ewelukwa, and EXIST’s Chief Executive Officer, Ahmet Türkoglu.
While Nigeria’s power generation has been stagnating at below 5000 megawatts (MW) due to multiplicity of challenges, Turkey boasts of generation capacity of 100,000MW, ranking as Europe’s sixth largest electricity market and the 14th largest in the world.
Approximately 54 per cent of the European nation’s power generation capacity comes from renewable energy, including hydroelectric, wind, solar, geothermal, and biomass power plants, making it the sixth largest generator of renewable energy in Europe and the 12th largest in the world.
The country is well advanced in electricity infrastructure and cross-border trading, hence the optimism about the opportunities presented to Nigeria by the new partnership, especially as the Government of Turkey has shown keen interest in strengthening bilateral relations between both countries.
Speaking at the agreement signing ceremony, Ahmed was quoted in a statement issued by NBET, yesterday, to have stated that Nigeria wanted to establish a solid electricity market like Turkey by providing the necessary transformation in the country.
“EXIST has reached an admirable stage. We also want to establish electricity markets by providing the necessary transformation in our country. We want to cooperate with you on this journey by walking hand in hand,” the Minister stated.
Commenting on the deal, Ewelukwa expressed optimism that the cooperation agreement with EXIST would go a long way in re-positioning NBET for enhanced performance in the Nigerian electricity market and consolidate on its accomplishments.
“The key aspects of the cooperation would see NBET strategically leveraging on cutting edge technology to chart a new course in its commercial transactions in the electricity market. It will ultimately pave the way for more power investments in the country and deepen competition in the market, with greater value delivery to participants in the market,” he said.
According to him, NBET would also synergise with EXIST in developing a framework for upscaling sustainable investments in renewable energy in line with the federal government’s commitment to diversify the country’s energy mix and transition to a low-carbon economy.
The corporation, according to the statement, also ties in neatly with NBET’s long-term plan of leading Nigeria’s renewable energy push in line with its mandate.
It said the cooperation agreement covers the transfer of experience and business knowledge, and the design of a functional trading structure for the Nigerian Electricity Supply Industry (NESI).
The statement further explained, “With this partnership, the NESI can leverage EXIST’s experience towards the design and implementation of policy frameworks that will ramp up energy solution to the manufacturing sector and other vital economic sectors towards increasing the Gross Domestic Product (GDP) of Nigeria and improving living conditions of its people.
“The agreement also aims to liberalise the current market in Nigeria; simultaneously, for the cooperation, the parties have agreed to establish a partnership to support the optimisation of NBET’s current energy portfolio and identify sustainable means to scale up energy generation and supply in Nigeria.
“Concerning areas of cooperation, the parties also agreed to ensure knowledge development and share cross-visits to learn from each other’s experiences. Both parties have committed to further research and development in relevant areas that are beneficial for enhancing the energy sector in Nigeria.
“In addition, EXIST shall also assist NBET in the design and implementation strategy and plan that would enable optimal bulk electricity trading that adopts a least cost trading model for energy efficiency.”
However, in fulfilling the conditions, the partners said EXIST shall assist NBET in under-studying the Turkish experience and energy transition to adapt successfully to the Nigerian context.
NBET currently manages a portfolio of over 13,000MW of installed electricity generation capacity.
Further to this plan, the statement added that “the two parties will work towards establishing a renewable energy support scheme like the Turkish experience and both parties will work on developing necessary feasibility studies to establish the energy exchange”.
Turkey has a large and growing manufacturing base which requires an increasing amount of power generation and the country’s annual growth rate in additional power generation capacity has been around five per cent due to the increasing economic activity and a rising population in the country.