Settle Less than 30% in first 9-month of 2017
Efforts to an to end to financial constraints in the power sector has obviously failed to yield tangible results, records show that the problems still persist. Records from the 11 distribution firms show an outstanding N269.3 billion in the debts portfolios on energy allocation in the first nine months of 2017. Records for energy invoices and performances posted by the Nigeria Electricity Bulk Trader (NBET) show that a 29 percent average payment of the sum of N108.3bn was made by the 11 Distribution Companies (DisCos) on a total of N377.6bn invoice.
NBET manages the energy invoices of the GenCos, DisCos and, the Market Operator (MO), NBET collects monthly revenue from the DisCos drawn from both residential, commercial and industrial customers. The sum remitted by the DisCos to NBET is expected to be equal to 1the sum of the energy invoices from the GenCos, this is to sustain the operation of the electricity market agreement with the Transition Electricity Market (TEM) and the Multi-Year Tariff Order (MYTO) 2015 rules set by the Nigerian Electricity Regulatory Commission (NERC).
However, since the TEM activation in 2015, the privatized distribution firms have found it difficult to meet up to 80 percent of their monthly payments as records from the MO and NBET show. The remittances have degenerated to an average 30 percent since 2016 with Port Harcourt, Kano and Yola DisCos making zero remittances in six months of the review period.
Records show that the P/ort Harcourt DisCo missed remittance for July and September, while Kano DisCo missed June, July, and September. Yola DisCo did not remit for six months; it remitted only for January, February, and May. Eko DisCo and Ikeja DisCo were the top performers. while Ibadan DisCo and Benin Disco occupied the fourth others include Enugu DisCo at the fifth, and Abuja DisCo at the sixth places, Port Harcourt DisCo was at the seventh position; the eighth position was occupied by Kaduna DisCo, and Jos DisCo took the ninth position. Yola DisCo which has been taken over by the federal government is the worst performer while Kano DisCo occupies the 10th position.
The result of the analysis noted that 71 percent of the energy revenue expected from the DisCos was constrained in the first nine months of 2017. it Showed the gaps between the GenCos’ invoices and the payments they received from the DisCos while the data analysis shows that three of the overall top GenCos group including Ughelli, Egbin, and Okpai stations posted N128bn but received only N37.2bn, representing 29 percent of the invoice figure.
NBET currently manages an N701bn Payment Assurance Guarantee (PAG) fund from the Central Bank of Nigeria (CBN). After the DisCos’ 30 percent remittances, the fund guarantees up to 50 percent additional payment to the GenCos every month that will end by 2019.