By Omoh Gabriel, Business Editor
Owan holds a Ph.D in Energy Management from the University of Pennsylvania. He worked extensively as an Energy Analyst and Regulator in the US. In 2005, as Director, Regulatory and External Affairs for Washington Gas Energy Services, Inc. Virginia, he got a call on his answering machine from one Senator Ita Giwa while vacationing in Jamaica with his wife. The call had a tone of urgency. Senator Ita Giwa! What would a Senator want to talk to him for? He wondered. He was sure she was not the same Ita Giwa he knew. A quick check on the website revealed all the names of Nigerian Serving Senators in 2005 Рthere was no Senator Ita Giwa among them. “419!” He told himself,” you can’t do me in!” and he ignored all her desperate calls, including those of who called themselves her aide.
His brother in Nigeria then called. “What is wrong with you,?” he demanded in anger, “Speak to the Minister of Power and Steel, (Senator Liyel Imoke) he’s on the line now”.
This led to a succession of events, leading to his coming back home as the pioneer Chairman of the Nigerian Electricity Regulatory Commission (NERC).
Today, 22 Independent Power Producers (IPPs) have need licensed to produce 10 My of electricity worth NI.5 trillion of investment.
In this interview, Owan revealed to Yemie Adeoye and Luka Binniyat in his office in Abuja his fascinating rise from child hood to his present status, exuding charm, doused with wise-cracks with the virtuoso of thorough professional. It’s a must-read!
Can you tell us a little about yourself especially your years of growing up?
Thank you for the question. As regards my early life and upbringing, I would start by saying that my name is Dr. Ransome .E.Owan, I come from a very small town called Agbokim falls. We have two water falls under Ikom, and it is located in Itung Local government area of Cross River state. I am the third child out of many children. So my early upbringing was: Primary School in the village.
Which School?
St Gregory’s Primary School, and then I then joined High School in Ebonyi state in 1970. It used to be in Ume-ezeoka, but now it is called St. Anderns. In fact I stopped by there just this holiday to see it after over thirty years
Must have been quite emotional
Yes it was very emotional. After my high school I joined a program at Hope Wardell Training Institute in Calabar Рthis was between 1975 and 76 to do my Lower Six, and then the interest to study abroad started coming up, I was interested in Computers back in 1976 and so I first received admission to study Computers in London at a computer institute in London. But when I went into the British embassy to book for my appointment, I came back and my village people gathered together and said I should study something else, because with computers I wouldn’t get a job. And that was quite true because in my village then we didn’t even have a typewriter (Laughter) so trying to explain that you are studying Computer and showing catalogue and stuffs would not be really appreciated, so they decided that I shouldn’t even go to England. That was my first major set-back in life…
You must have been devastated
Yes it was a difficult time for me. So I decided not to go back to Hope Waddle and finish my HSC (Higher School Certificate)
So I left home at the tender age of about Sixteen and went to Ikom, and after about two to three weeks I convinced the Principal of Velos Commercial Secondary school that I could teach, Mathematics, Integrated science and other things with my mock result. I only had my mock result at the time. I was very young. The man looked at me and interviewed me. I convinced him that I could do it. He then wrote a note told me to come back and go to the Ministry of Education Calabar. So at that age I became a Secondary School Teacher ..
What year was this again?
This was in 1976. and for about a year I was there. But I had made up my mined to then go to America to study Industrial Engineering at that point because I was good in Maths and Physics.
I applied and, luckily, I received admission at the New York Institute of Technology in New York city to do Industrial Engineering. This time I decided not to tell my parents.( laugh). so I received admission, got my sponsorship, came to Lagos twice, received my visa, prepared everything, then I went back home and within two days I said was leaving in the next two to three days. Already I had my Passport and Visa already. So I knew that nobody would stop me at that point. That’s how I traveled abroad and this was in 1977. I was about 17 years old at that time an arrive New York City.
So what was your first impression of New York City?
Nothing really prepared me for New York City. It was around the winter month. I couldn’t count the dollars; I didn’t know the food they’ll give you salad and you were not used to it. You know, the whole environment and culture was strange and so much different. And put in mind that I was not a city boy as I did not grow up in Lagos or the big cities; rather I grew up in the country side. That was why trying to acculturate to the system was very difficult and with winter approaching, it did not make things easy. However I focused on my course..
The same industrial engineering course?
Yes! The same Industrial Engineering but transferred within a semester – 1978 semester. I transferred to Bernard Barrow College which is the Business School of the City University of New York. I wanted to do full business..
From engineering?
Yes, from Engineering, I thought Business was much better, in that program if you can pay for about twelve credits they would allow you to take up to eighteen to twenty one for free, so I opted for that program and in two and a half years I was through with my first degree.
How did you raise money for the program?
Part of it was from my parents. You know back then the naira was more than the dollar in value. If you were sent a little amount of money you could actually be okay. Part of my money source was from loans – Students loans and stuffs like that..
Where you allowed to work?
Yes, they could allow you to work for twenty hours a week as part time and, in the summer you could work full time. So through work and a couple of other things one could actually pay through and maintain oneself, I was also able to get a Federal Government‚Äôs loan in the United States to pay for my education…so through out my stay, I basically sponsored myself through loans..
We hope you have paid back all these loans now?
Only last month!.(General laughter)..And this is because I was tired of paying the interest.
So, I was very focused and after finishing my undergraduate in two and a half years it took a year to finish my MBA at Hofstra University, in Long Island New York. While waiting for my Post Graduate admission in that interim, I joined the Nigerian Consulate in New York as an Information Officer, working in the library, giving out information. You see, while waiting for Post Graduate admission, I went for country service (laughter) in New York City.
Soon after that I got my admission to do my PhD at the State University of Pennsylvania which is an Ivy League University. I signed up for a dual program which enabled me get a Masters of Science and a PhD, and I got mine in Energy Management and Tourism. That’s where I got my both degrees.
I finished that in record time and took time to write my dissertation. Sometimes dissertation takes longer than the program itself Рas they say sometimes benediction is longer than mass (Laughter) and I finished in 1998. But while I was doing my program I was also working in the industry as a practitioner. I was working then as an energy conservation expert. As energy management expert, my brief was, “how can companies save money buying electricity; buying natural gas; heating oil. How to reduce electricity, keeping yourself warmer in the winter, everything has to do with energy conservation”, that’s the sought of thing I did, and I did this for a city like New York City. I helped design their energy conservation programs; I worked for large companies like Alcoa. I worked for consulting companies and I also worked for a long time as a Senior Energy Analyst for New Jersey Transit, a major public transportation company in the state of New Jersey, with electric railroads, diesel railroads and thousand of buses all very energy intensive products with large facilities so I was the one person who managed energy for them.
What informed the Federal government’s decision to bring you back and have you as the pioneer Chairman of NERC but then I m sure you got married in-between all these academic programs, you want to tell us about this?
(Laughter) I actually don’t talk about my private life. Try allowing it to stay private, but since you’ve asked me I’ll tell you. For my first marriage, I met my wife at a social function and I have a daughter by her with the name Lauryn Owan, she’s just preparing for college now in U.S I also have my son who is as well preparing for Post Graduate work, so, that’s how we met and fell in love, got married in New York city and that marriage produced a beautiful daughter
What year was that?
I think ‚Äú83 or there-about. We were together for almost fourteen years. But that marriage didn‚Äôt quite work out. It failed, and so I took a breather and in July of 2005 …I hope my wife doesn‚Äôt read this (laughter) I met my second wife. She‚Äôs originally from Jamaica, though she grew up in New York city. She‚Äôs actually a New Yorker. We got married in New York city again. And that was the time I received a call from Nigeria to come for Senate clearing and background check. Even during my honeymoon, I was filling out the papers for background check and all of that and she was very patient with me. You can imagine your honeymoon and your husband is pursuing papers and everything (Laughter). In fact, the week we came in here, was not a very good week for Nigeria. That was when we had a major plane crash as well as the death of the First Lady. Even our Senate confirmation was delayed. But my wife came with me on the first day to Nigeria. So that‚Äôs been my experience in family life. I enjoy my private family life; I try not to take too much work home, and also try to be home early for dinner (Laughter).
Now your prompting to come and reform power sector
As regards my prompting to the energy sector, I’ll say that I’m not really sure what could have informed the Federal Government to identify me to come and be the pioneer Chairman. To be frank with you, because I wasn’t aware of anything they were doing within the country and I wasn’t aware of the vacancy at all. In fact it was the evening I ‘went to New York city to do our last rehearsal and in the early morning, I was coming to Washington DC for a hearing with the energy commission in Washington DC, then on my way that morning I got a phone call from my brother who said where have you been, people have been trying to reach you and the President could get annoyed what is going on? And I said why? He said Mr. President wants you to come to town, I said why? and he said Mr. President wants you to come to town and I said for what, he said no just that they have been trying to reach you and you’re not responding to their calls, I now remembered and said yes actually one senator Ita-Giwa has been trying to reach me, the person has been calling my house in the Washington area, leaving messages, so I went to the internet and looked at the current senators, l did not see any Ita-Giwa on the list, so I did not return the call.
You thought it was 419?
Yes I thought it was 419 so I never returned the call, her special assistant Zakari was also calling me, and I said what has an Hausa man got to do with Ita-Giwa, what are these people pursuing me for? and because her name was on the list I checked, I did not know it was the same Ita-Giwa who was a former Senator, until a family member called me again and said people have been calling you and you’re not returning your calls. I said yes I’ve been getting blind calls, people I don’t know so I did not return the calls. He then said that the minister would like to talk to me, and I told him I was driving at the moment so when I get to Washington DC I’ll call him back to get his number, so after finishing my meeting in Washington DC I called the Honourable Minister Liyel Imoke and said Minister I got a call that you’ve been wanting to talk with me and he said yes it’s through and gave me a hint of what was going on and that they would like me to come back home, and remember I was already a senior director in my company.
What’s the name of that company?
Washington Gas Energy Services, we were already in the deregulation market and I was director of regulatory affairs, this has to do with applying for licenses for my company, intervening in cases before the legislature, board at the federal and state level, so everything I’m doing now, I was doing comfortably well in the state of Virginia, in the district of Columbia Washington DC, in the state of Pennsylvania and the state of New Jersey, so I was already doing well buying renewable energy and selling to people, so I was already in a business for a long time, he say’s no, please before you say anything just come and see what’s going on..
Before then were you home recently
Well I was home in 2004 for an energy conference of the PHCN and I presented two papers, one was how to make the utility more profitable and the second was on the experience of the united States in deregulation and lessons for developing countries like Nigeria, so those were the papers I came to present then, and that was my first time.. And maybe because I gave the organisers my résumé to make a brochure, and that was the only time some one would really do have my background here. The organisers did a program containing my bio, and the minister came and opens the occasion and i guess he later saw my papers and the MD Makoju and every player in the sector were present. So I told my wife that I think we should cut our hone moon down by one week because they really want to see me.
The way the commission is structured do you report directly to the Presidency or the ministry of power
I dare say that commission is one of the few ones that can be truly referred to as an independent commission, by law we provide quarterly reports to the presidency and the National Assembly, that’s the only reporting requirements but we are not a ministry and neither are we a parastatal under the ministry.
Where do you get your funding from
By law we are suppose to get our funding from two areas, primarily its supposed to be from the industry we regulate but because the industry is weak, like PHCN collection rates now is very low and the people we licensed haven’t really started producing electricity, we still go to the National Assembly to give us the needed support, but the idea is that the moment the industry is steady the government should not spend a penny on us.
Sir when you were invited to take up this job, you looked at it as a daunting challenge I’m sure, so what challenge would you say you have been faced with thus far
You know this is a very high national privilege for me, most of us abroad always look for a good opportunity to come back and contribute to society and give back to your beloved country, and many did not have the opportunity that I have now enjoyed so I first look at it as a very high privilege to come back to the country and serve, but also the issue of power is fundamental to the growth of every body, whether you’re a child or adult, economic wise, security, safety and virtually all aspect of life is tied to electricity, so when i was given this job I thought of it that I would really need very large shoulders to carry this job because every part of the business, from generation to transmission and then distribution has very big issues including society issues, such as power theft, equipment vandalism, pipeline disturbances, bypassing of meters, and lack of maintenance equipment, in fact some of our power plants are left with equipments that are not over-hauled over the last twenty years.
, and if you drive a car that has not been over-hauled for twenty years don’t expect it to serve you efficiently, so on the one hand I doff my hat for the engineers who strive barely to ensure that our power plants keeps running, the second major challenge that we faced was how to create confidence in the market place so that investors and consumers can rely on us for level playing field in decision making and telling them that the rules and regulations we make, we are not going to change it on them.
What changes can you say has been effected since you took over the regulation of the power sector?
Thank you very much; I believe that we have made marked improvement and measurable difference. From our beginning we began work on November 1, 2005, that’s when we were inaugurated and the Electricity Act was passed on March 11, 2005. So we have now worked in just over two years. What have we done that has made the difference in this short period? Before that time, aside from some oil companies AES and Agip, ordinary companies were not allowed and they had no mechanism for them to participate, so the best for them to do was to put that in place and we came up with the regulations thatwas publicly and officially gazetted. So they are now laws of the land and people have begun to apply for licenses and as of today over twenty two companies have been licensed since we’ve been in place. The total Megawatts is over ten thousand Megawatts that they are going to produce, investment would be over one and a half trillion naira from the private sector waiting to put up their own money to help solve our power problem.
Another area is that of consumer protection, you know sometimes the consumer in Nigeria has been long suffering, some people complain of crazy billing, mass disconnections, poor service etc, the commission has listened and we have passed rules and regulations controlling the disconnections of electricity to customers, we say that mass disconnections lead to wrongful disconnection of customers including those that have paid so instead of disconnecting people en-masse, the utility company should only disconnect those who have passed over due bills, this way you don’t disconnect a street or go and remove a transformer. You now only disconnect individual customers that are owing you and have refused to pay, that way we’re more customer friendly.
Furthermore we’ve also stopped the over estimation of bill, some people have not received their bills for a very long time. There are certain reasons why some one may not be able to read your meter all the time. He could be sick, he could come at a time when there is no one home and so on, but then it shouldn’t be in perpetually and so the regulation we have set now is that every customer in terms of their bill of rights, the utility company can not go more than ninety days in the fourth month they must attempt to effect a reading.
Another area is that since every utility company has standards and so for our own we have passed out the grid code, this is how those wishing to generate electricity how to connect it into the grid for evacuation, we also have the transmission code, so the transmission company of Nigeria now has a standard to follow, we also have the distribution code for each distribution company on how they can step it down and bring it your house, they should meet this internationally accepted standards, we’ve also come up with billing standards and metering standards, while as we speak we are working on the safety standards, so we are working on all these standards to try and standardize the power sector. The mission of this commission however is to ensure that electricity is adequate, safe, reliable and affordable.
why is it that with all the energy dissipated on the sector by the past and present administration we still seem to be far from it
The fact is that the sector is very capital intensive and needs an infusion of a lot of money and from our perspective government does not have the money to do it alone, the national budget is not enough to solve our power problems, that means we have to create an environment for investors in the capital market and the financial market to come and invest in the power sector, just like they are investing in the telecoms sector, these GSM companies they’re not lacking for money because of the scratch cards, so they loan money to the telecoms companies knowing fully well that these ones will pay them immediately, so they give money to increase their reach and expand their network, the same thing has to happen in the power sector so that the investors and the bank can see that when loan money there will be repayment methodology, if the consumer can not pay all of it on time we understand and give a subsidy, but once the power sector becomes strong and we can see it from the cash flow then government will wash off its hands completely from that kind of heavy support, so we are saying that financially the sector is struggling because investors don’t have the full confidence, we are talking about one and half trillion naira in investments here and people are now looking for loans in the banks, they’re asking two key questions, who will guarantee the supply of that gas and how much will accrue from this electricity you are proposing, so if the banks are asking how much the country and the regulator is going to allow you to charge we have to answer those questions otherwise investors are not into charity and banks are not ready to give their money, so we must as a country address the issue of how much does it cost for electricity and find a way to pay for it. If the investors and the banks can see that their is a way to pay for this they will certainly give out the money, the money is endorsed by all Nigerian Banks have been knocking on our doors saying they would also want to participate, but every body is still sitting on the fence, the tariff show how you are going to pay me, and who will cover the shortfall if one arises, will you guarantee me gas supply? Which is very fundamental issue, so if you guarantee investors the security of energy supply whether they are into coal, can you give them the right to that coal and they’ll come.
So the investors confidence is piqued and we have sold to the bank that there is more money here than GSM.
Electricity as you may know is a manufactured product if you do not manufacture it you can not have and because of this no one could set up a factory and not know the price of his products and more so in our country we are more used to ready made solutions and electricity is not subject to this otherwise we would have been importing it from China (general laughter).
There are speculations that there is an energy cartel who are into the importation of power generating sets and they are the ones also thwarting all efforts at achieving steady power supply in the country
Categorically I’ll tell you that i am unaware of that. But as regards competition which I’ll dwell on those who are selling generators are doing so because there is a demand for it as there is no alternative, hence people who are buying this are individuals that could not wait for the network to give them power, so they are solving their own power problems, so we are not going to get involve in this debate of who is a cartel or mafia or whatever it is called. we strongly believe that the network power would be a lot more competitive than private generation, so it is an option we are giving at a consumer choice. if we provide adequate security at lower cost would the consumer continue to generate on the own or would they be glad have more quite in their neighbourhood and draw out electricity from the network the question is if we can give them adequate and steady power supply, we strongly believe that they would abandon their generators and pay their bills.
