NBET’s paid over N2trn to GenCos in five years

The Nigerian Bulk Electricity Trading Company (NBET) paid over N2 trillion to the 26 Generation Companies (GenCos) between 2019 and 2023, the key operational financial data of the Nigerian Electricity Supply Industry (NESI) has revealed.

The sum was paid out of an invoice of about N4 trillion, leaving an accrued shortfall of N2 trillion.

A breakdown of the figures showed that in 2019, 2020 and 2021, the actual invoice to NBET by the GenCos were N671 billion, N775 billion and N823 billion respectively.

Out of these, the trading Company paid N174.3 billion, N230.1 billion, and N431 billion to the GenCos.

Between 2022 and 2023, the GenCos presented N814 billion and N896 billion respectively but N549 billion and N635 billion was paid.

In August 2022, the Association of Power Generation Companies (APGC) lamented that its members were owed N1.75 trillion for power generated for the electricity market since 2013.

The Executive Secretary, APGC, Dr Joy Ogaji said the liquidity challenge of the Nigerian Electricity Supply Industry (NESI) had made operating in the generation value-chain very difficult for the companies.

Meanwhile, within the period, the industry data revealed that the country experienced 27 partial and total grid collapses.

The incidence of grid collapses is one that the country has yet been able to find a lasting solution to.

According to the figures, the industry within the period, witnessed 21 total and six partial collapses.

Also, the data showed that out of over 12.6million registered electricity customers, only about 5.7 million have been metered.

The current metering gap is put at an approximated 7 million customers.

The Nigerian Electricity Regulatory Commission (NERC) had in its quarterly reports attributed the overall decline in DisCos’ collection efficiency to the decline in metering electricity consumers.

“DisCos continue to implement various collection campaigns to improve remittance for post-paid customers.

“However, their low collection efficiency is a threat to the NESI’s financial sustainability. To address this the Commission plans to enhance its monitoring of metering programs, such as the National Mass Metering Program (NMMP) funded by the Central Bank of Nigeria and the Meter Asset Provider (MAP) scheme, being implemented by DisCos.”

This underscores the need to intensify the push towards closing the metering gap especially at a time when the DisCos were already pushing for a review of the electricity tariff.

Although tariff review is inevitable, this may further affect collections if:”the DisCos refuse to evaluate options for improving the optimisation of their energy delivery in line with the Service Based Tariff (SBT) regime,” says NERC.