One of the key concerns in this Saturday's Nigerian elections is the perennial issue of electricity production in the country and the disastrous state of the power sector.
Reflecting a 50 percent cut in the price of oil exports, which are vital to the Nigerian economy, state revenue has shrunk, resulting in a 30 percent drop in the exchange rate. This has even managed to ruffle the feathers of wealthy business magnates, as well as the middle class. The trouble has been felt more keenly at the bottom though. More than 60 percent of Nigerians are estimated to live on less than $2 a day and budget cuts at both state and federal level are undermining public services.
At the beginning of the week, US President Barack Obama used his position as content curator of the White House's YouTube channel to release a video that extolled the greatness of the Nigerian nation before warning — in case anyone wasn't sure — that "violence has no place in democratic elections." Obama talked about the challenges Nigeria faces but then only mentioned the one currently obsessing the international community: Boko Haram.
The presidential rivals — incumbent Goodluck Jonathan of the People's Democratic Party (PDP) and his challenger Muhammadu Buhari of the All Progressives Congress (APC) — have played into this narrative somewhat. Both candidates have focused on security and military engagement with Boko Haram, rather than any of the underlying causes that have led to their rise.
Yet for many Nigerians, energy production trumps militancy as an issue at the ballot box. Nkaiso Akpan, a citizen reporter for On Our Radar, passed on an interview with Eze Ahuju, from the Niger Delta, who stressed this priority. "There's no light in my community, people are suffering. This is the biggest issue for everyone this election."
It's not hard to see why. Nigeria has one of the world's lowest rates of generating electricity per person, producing 4,000 megawatts for a population of over 170 million. Brazil, with a population of 200 million, generates 24 times as much. Sixty percent of Nigerians have no access to the national grid and when they do, it can't be relied on.
A reported 60 million own generators to provide electricity for their homes and businesses. The cost of running generators, which are expensive, loud, and polluting, holds back business and keeps people poor. Many more people burn firewood. During the frequent power outages, which can last for days, those not rich enough to own generators have to burn candles and kerosene, which are still far more expensive than electricity from the grid would be.
Privatization had, for a while, been considered to be the answer to the problems of the power sector. In 2013, Jonathan's government put this policy into place by selling off a raft of state-owned power assets. The expressed hope was that the private sector would provide the vast sums of money needed and would be less susceptible to the corruption that previously dogged electricity production.
Olusegun Obasanjo, who was president from 1999 to 2007, sunk $16 billion into the sector but power output had, by the time he left office, gone down. Obasanjo is often accused of serious corruption and the National Electric Power Authority (NEPA), the former organization governing the use of electricity in Nigeria, was also notoriously corrupt, so it's not too hard to imagine where some of that $16 billion might have gone.
Since privatization, the government says it has improved production and that, though prices are going up, it is mostly those who can afford it who are taking the hit. Lai Yahaya, who is now a Team Leader of President Obama's Power Africa Senior Advisors Group, was involved in the design of energy privatization. He told VICE News the idea was that "private sector produced electricity would be more expensive but half the price of generators, which was what most people were using. And then, it would be a quarter of the price of candles and firewood."
This increased production is being disputed on the ground though, something that Yahaya who has problems getting electricity in his apartment knows only too well. Ken Henshaw, senior programs manager at Social Action, an organization based in Port Harcourt in the Niger Delta, is far more strident in his criticism. "The Nigerian government has a very narrow definition of privatization. For them, privatization means selling public assets to their friends at ridiculous prices… Nigerians were blackmailed by various governments into believing that the answer was power privatization," he told VICE News. "All it's meant is more darkness and more tariffs."
Henshaw is also deeply suspicious of government statistics that claim improvements are being made. "If power output is to improve, shouldn't we be seeing infrastructure on the ground? If the government is claiming that it has increased output from about 1500 megawatts six years ago, to about 4500 megawatts now, shouldn't I see an improvement in my house?"
Jonathan was talking to those who share Henshaw's anger when he said that the effort to being dependable electricity to Nigerians "wouldn't happen in one day… It's going to be gradual." This line is something that the scheme's two main international supporters, the World Bank and the UK's Department for International Development (DFID) also stress. Between 2013 and 2016, DFID will provide £100 million ($149m) to the Nigerian power sector and with 0.7 percent of the UK's budget now enshrined in law, the money is likely to keep coming.
DFID's involvement in Nigerian energy privatization has come under scrutiny recently, with the campaign group Global Justice Now questioning why British taxpayers were helping fund a process that was, in their eyes, designed to move power and profit into private hands without benefitting ordinary people. The NGO cited price rises and job losses as two of its main concerns, and questioned the involvement of the consultancy firm Adam Smith International (ASI), which is contracted by DFID to support power privatization via the Nigeria Infrastructure Advisory Facility (NIAF) project.
Nick Dearden, Global Justice Now's director, told VICE News that ASI's involvement in the disastrous privatization of Tanzania's water system was evidence that the British government was simply ideologically committed to privatization and ready to support it whatever the results. Nigeria is lucky in that it has yet to be subjected to an ASI-produced pop song celebrating privatization, as Tanzania was.
A source in the Nigerian energy sector also accused ASI of charging DFID too much money for outside consultants and then making money on the margins. Those consultants are outsiders who use their private sector experience in Europe to get cushy gigs in exotic locales, the source said. The frustration for some is that these foreign consultants are merely salesmen looking to keep the aid gravy train rolling. The money that is spent on them could, the source suggests, have been spent on providing free solar lamps to the Nigerian people.
ASI's Thomas Pascoe, who is a manager on the NIAF program, dismissed Global Justice Now's claims and offered a robust defense of the program. He told VICE News that they were "based on a lack of even a cursory understanding of the Nigerian power sector." Pascoe went on to say that, while "current levels of electricity generation and supply are inadequate, infrastructure investment takes time and the benefit is felt years down the line. This is the case whether the sector is in public or private ownership… What we can say is that the private sector seems to be rising to the task." He added that 70 percent of ASI's specialists on NIAF are Nigerian or from the Nigerian diaspora.
And yet the Nigerian people remain poorly served by corrupt elites. The assets that were sold off as part of privatization were all sold to companies represented in one way or another by rich men close to the heart of power. The previous state-controlled corruption appears to have been replaced by oligarchical corruption of the private sector. Money for buying the assets came from bank loans and much of it was debt. In September last year, Nigerian oil Minister Diezani Alison-Madueke announced a $1.3 billion bailout for power companies saddled with debts inherited from the state electricity company.
Investigating corruption in the privatization process, Vanguard reported that: "Specifically, some of the banks, it was discovered, were pressured by their Board of Directors to grant loans to power firms where some of their directors have interests." A source in the Nigerian financial sector told VICE News that a number of banks were not necessarily expecting to get their loans back.
Proponents of privatization say it will take a while before improvements are noticed on the ground. Yet the worry is that, far from having strode away from the infamous corruption of the Obasanjo days, the Nigerian power sector is simply mired in a new kind of corruption, one that continues to serve a small group at the top in Nigeria and abroad, while letting down the people that need it most.
A source in the natural resources sector made his exasperation clear: "They have taken people's money — the same people lying in the streets — and it's going to these bastards, the patronage guys. Again!"
Follow Oscar Rickett on Twitter: @oscarrickettnow