Energy crisis: GenCos blame ₦1.64trn debt for state of power supply1
The power generation companies (GenCos) have attributed the current state of electricity generation in the country to the ₦1.644 trillion owed them by the Nigerian Bulk Electricity Trading (NBET) Plc. The debt arose principally from unpaid capacity charges from as far back as 2015
Dr. Joy Ogaji, the Executive Secretary (ES) of the Association of Power Generation Companies, noted that the NBET has not met all its obligations to the GenCos as contained in the Power Purchase Agreements (PPA). The ES gave a breakdown of the debts owed the GenCos as ₦214.93 billion in 2015; ₦273.32 billion in 2016; ₦236.47 billion in 2017, ₦264.08 billion in 2018, and ₦256.97 billion, ₦266.01 billion, and ₦120.25 billion in 2019,2020 and 2021 respectively.
Nigeria’s national grid has been plagued with challenges in the transmission and distribution subsectors, which has made it difficult to evacuate the available generation capacity through the grid. The Nigeria Electricity Regulatory Commission (NERC), based on data obtained in 2021, reported that power distribution in the year, averaged 4,094.09 megawatt (MW), despite available generation capacity of about 8,000 MW2. Relatedly, average unutilized power generation increased year-on-year, YoY, to 3,008.18 Megawatts, MW in 2021, from 1,030.80 MW in 2013, indicating an increase of 291 per cent in the past eight years. Efforts are ongoing to improve the state of the transmission and distribution network with several projects earmarked in the 2022 Budget. However, it is not clear when the grid, will begin to see the impact of these efforts.
Click here to read more on this publication
1 https://dailyasset.ng/electricity-crisis-gencos-blame-n1-64trn-debt-for-low-power-supply/
2 https://www.vanguardngr.com/2022/01/how-poor-generation-metering-gap-financial-crisis-shackled-power-sector-in-2021/
