Tony Elumelu, the chairman of Heirs Holdings, United Bank for Africa, Transcorp and founder of The Tony Elumelu Foundation, was interviewed by Arise TV on Wednesday, May 5, where he talked on a range of topics affecting the Nigerian economy.
During the interview, Elumelu was of the view that we have to drive economic growth in Nigeria. To achieve this power sector must work well and for the power sector to work well, there’s a need to increase generation and improve gas supply to generating companies.
There’s also need to ensure that the transmission lines are capacitised to evacuate the power, and ensure that power generated is taken by DisCos and that the end users pay the right amount.
Nigeria’s power sector is a critical sector in need of many investments and the stakeholders need to make sure that it works in order to actualise economic development.
Every sector of the economy needs a stable power sector to thrive and Nigeria needs nothing less than 100,000 megawatts of electricity.
Entrepreneurs, who are beneficiaries of the Tony Elumelu Foundation, say one of the major challenges they face is poor access to electricity, hence, despite the grants given, some of them find it difficult to succeed because they spend so much on electricity.
According to Elumelu, the transmission lines should be privatized and the Gencos and Discos should come together to strike a deal with the federal government to take over the transmission lines.
“Also some of us in the generating space have signified interest to be involved in the transmission end so we can collectively make it work.
“Although it is getting better, more can be done and basically what operators in the sector need is expanded capacity, We need to fix the transmission lines and improve the payment system. Each of the three components of the power sector must work well, proper generation, appropriate transmission and improved distribution,” he said.
The Transcorp Hospitality Business
The Transcorp Hotel project located at Glover Road Ikoyi is still in the pipeline, but there were issues with certain authorisation from the government that slowed things down, according to Elumelu.
He however said the project was in a good place now and before the year ends, some commercial activities would commence there.
The old Falomo Shopping Complex is an exciting project but government authorisation also delayed its implementation and commencement.
The project started during the Babatunde Fashola administration as Lagos State governor, it was however truncated during the Akinwunmi Ambode tenure but this current administration of Babajide Sanwo-Olu will revive it.
But now the government, the company and its investors are looking to restart the project. This time with a different design, which is an office complex, a mall and a hotel.
However, it cost three times more to implement the project now as against the time it was initiated, and this is one of the reasons why we had to change the initial concept. However, we want something extremely iconic established there.
Transcorp has two companies in the power sector, which are the Transcorp Power and the Trans Afam Power, and are both limited companies.
The Transcorp Power owns the Ughelli Power Plant, which has an installed capacity of 990 megawatts of electricity, and the second plant is Trans Afam Limited, which has a capacity between 980 and 990 megawatts. When combined both companies generate almost 2000 megawatts of electricity.
Trans Afam Limited is a $300 million acquisition and although the plant has not been completed, it is being handled by General Electric and they promise to complete it this year.
“The government believed in us after seeing what we did with the Ughelli power plant which was generating 150 megawatts daily, and we improved this to 750 megawatts which impressed the government this was during Goodluck Jonathan’s tenure as president,