Dirisu Yakubu, Abuja, FCT
Ever since he assumed duty as Minister of Power, Works and Housing more than a year ago, Babatunde Raji Fashola has been battling the barrage of criticisms directed at government by distribution companies (DisCos) over unpaid bills. For the Minister, the seemingly unwillingness to pay stem from uncertainties surrounding the exact amount owed by ministries, departments and agencies (MDAs).
Speaking recently at a one day Power seminar in Abuja, the Managing Director, Sahara Power, Kola Adesina lamented the increasing indebtedness of government and the private sector, noting that the development does not support continuous investment in power generation. Egbin, according to him, is capable of generating a total of 1, 100 megawatts of electricity but insisted the money being owed by the distribution companies is enough to send anyone out of business.
“The last time I checked, we are being owed over N100 billion; yet we are still doing our part to make sure power is available for evacuation. This is not good for the power industry because at the end, if we cannot sustain the cost of generation; there would be nothing left to transmit and distribute,” Kola stated.
It appears that the lamentation has now moved the hand of government given its readiness to begin the payment of all verified debts owed over the years to DisCos and GenCos for power supplied. This is against the backdrop of findings in the on-going audits of bills submitted by energy distribution firms.
The government’s decision is a fresh boost in liquidity in Nigeria’s power sector and is coming on the heels of the N701 billion guarantees for the Nigerian Bulk Electricity Trading Plc, NBET announced about a fortnight ago.
At the 13th Monthly Meeting of Power Sector Operators presided over by Fashola recently at Ughelli, Delta State on the on-going verification of government’s indebtedness to distribution companies, a report made available to the media, indicated moves by the MDAs to immediately clear all debts as a way of empowering electricity firms to do more in service delivery.
A communiqué issued at the end of the meeting stated that the audit team has so far received claims amounting to N59.3 billion, out of which an estimated N51 billion representing 86 per cent of the debts, are owed by top 100 energy consumers, made up of the military and defence installations across the land.
Consequently, the National Delta Power Holding Company (NDPHC) is set to embark on projects aimed at connecting rural communities playing host to the National Integrated Power Projects, NIPP, with progress reportedly at top gear in Egbema, Olorunsogo, Magboro, Omotosho and Ikot Nyong communities. According to Orient Energy Review (OER) findings, Magboro would be connected next month while connection for Olorunsogo is expected to be completed in June this year.
The meeting, according to reports also witnessed the presentation of reports on ongoing power projects in Ondo, Edo and Rivers States (Transmission Company of Nigeria report); completion of maintenance works in Awka, and Maiduguri aimed at improved service delivery as well as audited accounts by the Nigerian Electricity Regulatory Commission, NERC.
Aware that the economic progress of the country is dependent on the optimal performance of the power sector, the meeting commended government for the recent approval by the Federal Executive Council of funds to offset payment due power generating companies, GenCos, for power generated and supplied to the national grid
Participants also expressed joy with government’s decision to release the sum of N701 billion to NBET for payment to GenCos under the power purchase agreements. DisCos were however warned not to renege in their payment of invoice to the market operator for services provided by Transmission Service Provider (TSP) and Independent System Operator (ISO).
The Minister called on the people of the Niger Delta to embrace peace, saying without it, development of the region would be elusive.
“The governors of the Niger Delta have been and must continue to be the champions of peace. The youth of the Niger Delta must recognise that nobody can be more Niger Deltan than Tony Elumelu (Chairman, Transcorp Power Limited). He chooses to invest here. So every time you take away gas from this plant, you are hurting one of us, you are hurting one of your own and we are losing opportunities,” Fashola stated.
With this move, power supply is expected to be relatively stable in the next couple of weeks as the liquidity challenge is now being addressed. Nevertheless, in the words of Fashola, meters must be provided to customers to enable them pay appropriately for energy consumed. Anything short of this would be tantamount to a negation of the change agenda of incumbent administration.
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