The Manufacturers Association of Nigeria (MAN) is in advance negotiations with ASB Valiant Company Limited for the provision of 80 megawatts (MW) of power to industries at the Lagos-Ibadan/ Makun corridor.
The ASB Valiant’s power plant will be tri-fuel, meaning that it will involve the use of natural gas, liquefied petroleum gas and diesel.
The power company will begin with 7.52 MW and will increase its capacity as demand rises.
Speaking at a presentation to MAN in Lagos, Ayodele Ikumapayi, managing director of ASB Valiant, said the company was coming up with a power solution that would have a back-up and at a sustainable cost.
“The consideration for that corridor is 80MW capacity, but it’s going to be in phases and as we see the load growing, we will then be increasing the capacity of the plant. Because we are dealing with two double circuit in different directions with each feeder able to take 20MW, we will be applying 40MW on each tier . We are going to start with 7.52MW and then move to 40MW. So we are going to grow as the demand grows,” Ikumapayi said.
He said it was a win-win situation for the company and manufacturers, stressing that this was the best power supply model in that off-takers would be credible, coming from MAN that was one of the most respected organisations in the country.
He said the price of power would be in naira, stressing that a marginal increase in foreign exchange would not necessarily affect the power price.
Ibrahim Usman, chairman of MAN Power Development Company (MPDC), who was represented by Francis Meshioye, council member of MAN, said the association envisaged this development few years ago owing to how much members spent on alternative energy sources.
“One of the things members say that erode their bottom-line is cost of power. This takes them out of their core duties. We looked at this and thought we should do this through private companies,” Usman said.
“We are willing and ready to tap into this power and we want to be sure there is a back-up,” he said.
Nigerian manufacturers, whose 40 percent expenditure goes to power, are increasingly abandoning electricity distribution companies popularly called DisCos for private companies that can provide 24-hour incremental and quality electricity at cheaper rates.
Already, the Manufacturers Association of Nigeria, through its recently formed MAN Power Development Company, has signed an agreement with Tower Energy Solution & Systems Limited for the supply of six to 10 megawatts (MW) of electricity to Henry Carr Industrial Cluster in Ikeja, Lagos.
MAN is negotiating with Negris Group for the supply of up to 80 MW of electricity to Odogunyan in Ikorodu industrial cluster.
The organisation is also talking with solar power supply firms in the northern Nigeria, where there is limited gas supply to enable clusters in Kaduna, Kano and other parts of the north to have incremental power at cheaper rates. A negotiation is on the pipeline with Sahara Energy, Geogrid LighTec Limited and other companies for the supply of power to industrial clusters.
Manufacturers spent N129.95 billion on alternative energy sources in 2016 as against N58.82 billion recorded in 2015.
The 2016 figure represents 121 percent jump from that of 2015, data exclusively obtained from the Manufacturers Association of Nigeria (MAN) show.