NBET owes power producers over N1tn, say Gencos
Power producers in the country have said they are owed at least N1tn by the Nigerian Bulk Electricity Trading Plc.
They said the debt was threatening their viability and undermining their ability to invest more.
The government-owned NBET buys electricity in bulk from generation companies through Power Purchase Agreements and sells through vesting contracts to the distribution companies, which then supply it to the consumers.
Estimates that the trading company has amassed N1tn debt to power producers since 2013 are “extremely conservative,” the Executive Secretary, Association of Power Generation Companies, Dr Joy Ogaji, was quoted by Bloomberg as saying in an interview.
“To be frank, I’m afraid for the survival of the industry in the next six months,” she added.
“My contract is with NBET to put power on the grid and be paid 100 per cent for it. Whether your off-takers are paying you or not, that shouldn’t be my problem,” Ogaji said.
The Discos complained that the regulator didn’t institute realistic tariffs when the electricity industry was partially privatised in 2013, and that price increases haven’t kept pace with inflation or responded to a deterioration in the exchange rate.
“If you’re underselling the product, how can you remit 100 per cent?” the Executive Director of the Association of Nigerian Electricity Distributors, Mr Sunday Oduntan, was quoted as saying.
The Nigerian Electricity Regulatory Commission on January 5 announced that it would raise consumer prices in April as part of a plan to help the distributors narrow their revenue shortfall.