Power station MRO market to grow as generation capacities expand

The maintenance, repair and overhaul (MRO) market in Nigeria is set for steady growth as several power generation plants begin expanding their capacities, according to an analysis from global growth consulting firm, Frost & Sullivan. The growth is also expected in South Africa and Zambia.

The market will continue to pick up pace as the generation companies begin realising the importance of adequately maintaining power generation assets.

The analysis, entitled ‘The Market for Power Station Maintenance, Repair, and Overhaul (MRO) in Key African Countries’, said the historic negligence of maintenance functions will boost the Nigerian MRO market.

Nigeria’s power sector, which had operated for several decades as a state monopoly, with the Federal Government having the exclusive right to own electricity generation, transmission and distribution facilities, was fraught with lack of maintenance and investment. Some of the generation equipment are dilapidated and requires complete overhaul.

With the recent take-over by private investors, upgrade of the power facilities are expected to be carried out to ensure better service delivery to the customers.

Cornelis van der Waal, business unit leader for the industrial unit, Frost & Sullivan, said, “While African power utilities are notorious for supplying inadequate and unreliable electricity to consumers, generation capacities are finally expanding owing to rising energy demand. The need to maintain these assets will compel power utilities to prioritise station maintenance and partner with station maintenance service providers to build skills and capacity.”

According to the firm, the large-scale use of MRO services is held back by a number of factors including the lack of critical skills to carry out complex maintenance activities, limited availability of financial resources, and rapidly escalating costs for extensive and regular maintenance services.

Efforts are now being made to ensure that the maintenance of power stations is prioritised and more secure electricity services are extended to power utilities.

“Management at power plants will be interested in training their staff through skills transfers, and MRO companies that factor this into their tenders will make headway in the market”, observed Van der Waal.

“Competitive pricing and the capacity to deliver quality engineering solutions will also be crucial.”

Nigeria is targeting 40,000 megawatts (MW) generating capacity by 2020, but power generation capacity currently hovers between 2,500 megawatts and 3,500 megawatts for a population of over 170 million people.

The downturn in power supply in many parts of the country following the hand-over to the investors had been partly attributed to a dip in generation capacity.

There are currently 23 grid-connected generating plants in operation in the Nigerian Electricity Supply Industry, with a total installed capacity of 10,396.0 megawatts and available capacity of 6,056 megawatts. Most generation is thermal based, with an installed capacity of 8,457.6 megawatts and an available capacity of 4,996 megawatts. Hydropower from three major plants accounts for 1,938.4 megawatts of total installed capacity and an available capacity of 1,060 megawatts.