Nigerian President Goodluck Jonathan unveiled his strategy to end chronic power shortages yesterday to an audience of business leaders and investors in Lagos.

‘Government is convinced that it is only by constructively engaging the private sector as partners in this journey of national transformation that we can be assured of success,’ said the president, flanked by ministers, advisers and state governors.

The launch of the "roadmap for power sector reform" is president Jonathan’s biggest policy announcement months ahead of presidential elections.

Lack of reliable electricity is one of the major brakes on development in Nigeria despite it producing more than 2 million barrels per day of crude oil. Businesses heavily rely on diesel generators to power everything.

Nigeria estimates it will need annual investment of $6-billion over the coming years if it is to meet its domestic energy needs, and is seeking to woo foreign investors with pledges to improve its regulatory environment.

The plans are the most comprehensive blueprint yet designed to solve Nigeria’s power problems.

Government hopes they will help unlock private investment, although financiers point out that formulating a plan is the easy part and investors will need cast-iron guarantees on the regulatory framework before they commit.

Much of the detail is already known, including the planned privatisation of generation and distribution and the construction of a new transmission network.

Some of the power firms in highly populated and relatively developed areas such as Lagos are likely to attract significant interest from foreign investors.

Successive governments have tried to fix the power problems, but powerful vested interests, such as billionaire tycoons who import diesel and generators and the chronic mismanagement of state-run utilities, has meant little progress has been made.

Source: Reuters