Nigeria may be set for a total blackout as power generation as well as distribution companies say over N400bn debts are stifling their operations.
While GENCOs’ debt is put at over N300bn, DISCOs have complained of being owed over N100bn by customers – Nigerians.
With such a huge debt burden, the power firms said they lack funding required for their operations, including the purchase of equipment and spare parts.
The Executive Secretary, Association of Power Generation Companies, Dr. Joy Ogaji, said, “The debt is over N300bn that GENCOs are being owed. If the situation is not checked, there will be blackout. It is so imminent that I don’t know if most of the generation we are having now can go beyond Christmas if the payment problem is not solved. We can’t pay contractors; most of the machines are packing up.”
Ogaji said the Nigerian Bulk Electricity Trading Company Plc should be blamed for the problem, saying, “As GENCOs, we don’t really have any direct relationship with DISCOs at the moment; GENCOs are meant to generate power and government brought NBET as a wholesaler, which takes all the power being generated by GENCOs and sells to the DISCOs. So the onus lies on NBET to collect the money from the DISCOs.
“The claim on whether DISCOs are remitting money or not should not be the problem of the GENCOs, but that of NBET. Government told us that NBET is properly capitalised and has enough money to meet all of the GENCOs’ payments. But unfortunately, NBET has not been able to do that.”
Officials at NBET told Punch that regardless of the fact that the they were established to support the sector financially, the bulk electricity trader would not use taxpayers’ money to settle the huge debts owed the GENCOs.
“This is primarily because of the inability of the DISCOs to make the required remittance to the NBET,” an official who spoke on condition of anonymity said.
But the DISCOs argued that aside the fact that the current Multi Year Tariff Order put together by the Nigerian Electricity Regulatory Commission was not cost reflective enough, the refusal of ministries, departments and agencies of government to settle their electricity bills was a major challenge.
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