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LAGOS ECONOMIC SUMMIT (EHINGBETI 2014)

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Presented by: Professor Bart Nnaji Chairman/CEO, Geometric Power Tuesday, April 8 th, 2014 HOW CAN ELECTRICITY TO LAGOS BE ACCELERATED?

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LESG Secretariat List of Countries by Electricity Production 2013 Global RankCountry NameRegion & Regional Rank Electricity - installed generating capacity kW 1ChinaEast Asia & Pacific | 11,146,000,000 2United StatesNorth America | 11,025,000,000 3JapanEast Asia & Pacific | 2284,500,000 4RussiaEurope & Central Asia | 1223,100,000 5IndiaSouth Asia | 1189,300,000 6GermanyEurope & Central Asia | 2153,200,000 7CanadaNorth America | 2131,500,000 8ItalyEurope & Central Asia | 3122,300,000 9FranceEurope & Central Asia | 4119,100,000 10BrazilLatin America & Caribbean | 1106,200,000 11SpainEurope & Central Asia | 5102,500,000 12United KingdomEurope & Central Asia | 688,020,000 13KoreaEast Asia & Pacific | 380,590,000 14MexicoLatin America & Caribbean | 259,330,000 15AustraliaEast Asia & Pacific | 456,940,000 16IranMiddle East & North Africa | 156,170,000 17UkraineEurope & Central Asia | 754,380,000 18TurkeyEurope & Central Asia | 844,760,000 19Saudi ArabiaMiddle East & North Africa | 244,490,000 20South AfricaSub-Saharan Africa | 144,260,000 2

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LESG Secretariat CityPopulation Installed CapacityActual Demand New York8.4 Million15, 488 MW18,102 MW Mexico City9 Million 24,627 MW9,308.7 MW Karachi13 Million1,750 MW2,650 MW New Delhi17 Million7,500 MW4,720 MW Los Angeles3.5 Million7,200 MW6,125 MW Rio de Janeiro6..3 Million1,538 MW Lagos15 MillionLess than 1000 MW Rio de Janeiro suffers from the power problems in Brazil Los Angeles enjoys excess supply of power and the city generates more than it consumes Comparison of Lagos to select Megacities 3

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LESG Secretariat Wide gap between supply and demand Obsolete and unreliable generation assets Weak and inadequate transmission infrastructure Overloaded distribution network High technical and commercial losses 4 Overview of the Nigerian Power Sector

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LESG Secretariat Value chain alignment Fuel Power Generation Power Distribution Electricity Delivery in Lagos 5

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LESG Secretariat Natural gas LNG NG LPFO Crude Oil Solar for grid stabilization Wind @ shore lines Lagos can use multiple fuels 6

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LESG Secretariat LNG to Power Schematic 7

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LESG Secretariat Purchase of power from the grid Direct Purchase Vested power through NBET Plc Generation Solution 8

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LESG Secretariat Generation Solution: Embedded Generation 9 Emergency Power Regular Power Development Lagos State development of power Contracting with IPP developers PPP development with IPP developers

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LESG Secretariat Emergency Power: Location Review Matrix 10 S/No.LocationCapacity (MW) Power EvacuationFuel TypeFuel Storage 1Agbara300Good Evacuation Facility available LPFO/GasReqd. 2Oworonsoki200No feasible route to evacuation facility LPFOReqd. 3Ajah300Good Evacuation Facility available LPFOReqd. 4Ijora200Good Evacuation Facility available LPFOExists (check Lease) 5Egbin300Good Evacuation Facility available LPFO/GasExist 6Alagbon300Good Evacuation Facility available LPFOReqd. 7Akoka200Good Evacuation Facility available LPFOReqd. 8Apapa/Snake Island200No Evacuation FacilityLPFOReqd.

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LESG Secretariat Emergency Power: Location Review Matrix 11 S/No.LocationBridge Obstruction Ease of AccessTechnology Type Proposed 1AgbaraNoneLand based accessLand based Gas /LPFO Turbine/Generator 2OworonsokiExistsMarine which may require dredging Barge mounted LPFO Turbine/Generator 3AjahExistsMarine which may require dredging Barge mounted LPFO Turbine/Generator 4IjoraNoneMarine accessBarge mounted or Power Ship - LPFO 5EgbinExistsMarine which may require dredging Barge mounted or Power Ship - LPFO or Gas 6AlagbonExistsMarine which may require dredging Barge mounted LPFO Turbine/Generator 7AkokaExistsMarine which may require dredging Barge mounted LPFO Turbine/Generator 8Apapa/Snake IslandNoneMarine accessBarge mounted or Power Ship - LPFO

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LESG Secretariat The use of LPFO as a fuel will have the following challenges: LPFO Requirement: A 220MW plant requires 45MT of LPFO per hr. (based Egbin LPFO consumption)1000MW will require 204.5MT/hr (172mln liters /hr @80% availability) LPFO Availability: LPFO can be obtained from the 3 refineries: (i) Kaduna (ii) Warri (iii) Port Harcourt 50,000 MT is available on daily basis and is currently allocated by priority to: (i) MAN (ii) Cement Manufactures and (iii) Other Users. This implies that massive importation of LPFO will be required. Emergency Power: The Fuel Challenge 12

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LESG Secretariat LPFO Cost : The cost of LPFO (ex depot) from the 3 refineries is as follows (i) Kaduna N68/liter (ii) Warri N107.99/liter (iii) Port Harcourt N107.99/liter (iv) Costal Transportation N85/liter This implies that the fuel component of power tariff will be 14.60 N/Kwh (using costal transportation) Emergency Power: The Fuel Challenge 13

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LESG Secretariat Only state with 2 DisCos Need to improve on network quality Need to install meters (pre and post) Need to improve on automation in billing and collection Need to install SCADA for monitoring of power distribution and leakages Need to have manageable clusters (economic electricity ring- fences) within DisCos Distribution Solutions 14

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LESG Secretariat Privatization-DisCos LGS is part owner two DisCos no longer helpless LGS can assert its influence by partnering with the DisCo operators to plan for efficient and effective distribution of power with Lagos. Effect of Power Sector Reform 15

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LESG Secretariat NERC NBET Plc GACN NAPTIN NELMCO EMS etc. Effect of Power Reform: Institutions 16

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LESG Secretariat Power Gas Solar, wind, etc. Effect of Power Reform: Cost Reflective Tariff 17

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LESG Secretariat Anyone or government can now participate in power solutions Capacity building to support power sector Legal Financial Environmental ICT Power Equipment Manufacturing etc Other Effects of Power Reform 18

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LESG Secretariat Aba IPP: Gas Pipeline Facilities 19 Gas Pipeline End UnitsGas Pipeline Pigging OFS (heater left, control container right) Osisioma Flow Station (OFS-filter) Pipeline route

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LESG Secretariat Aba IPP: Power Plant Facilities 20

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LESG Secretariat Aba IPP: Balance of Plant Facilities 21

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LESG Secretariat Aba IPP: Other Facilities 22 OVERHEAD LINES CONSUMER CENSUS TEAM OVERHEAD LINES

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LESG Secretariat Aba IPP: Overhead Lines 23

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LESG Secretariat Aba IPP: Overhead Lines 24

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LESG Secretariat Thank you www.geometricpower.com 19