FG Moves To Recover Debts From Power Firms

Vice President Yemi Osinbajo

The Federal Government may recoup its money from debtor power distribution companies by calling on their bank guarantees. This, it was gathered, had been brought before Vice President Yemi Osinbajo, who is the Chairman of the National Council on Privatization. Mid last month, the Federal Government ordered the power distribution firms to remit the outstanding amounts for capacity and energy invoiced against them since February before the close of business on July 24, 2015.

But two weeks after the expiration of the ultimatum, the affected power distribution companies have yet to comply with the directive.

The Punch report continues:

Impeccable sources at the Federal Ministry of Power and the Nigerian Bulk Electricity Trading Company Plc told our correspondent on Thursday in Abuja that the Federal Government had through the NBET written to the Discos and their various banks notifying them of the intention to call on their respective bank guarantees.

A top management official of the NBET said the decision had not been implemented because the vice president recently held a meeting with operators in the sector and the issue was discussed.

The official, who spoke on the condition of anonymity due to the sensitive nature of the subject, said, “We have written to the Discos and we have notified the banks that we intend to call on the guarantees. But how much of the guarantees should we call on is something that we are evaluating. But I can tell you that there have been some meetings at the highest level of government, where the Discos are consulting with the vice president, the Permanent Secretary of the Federal Ministry of Power and the Chairman of NERC.

“We also attended that meeting. And due to that intervention, we have to see how the outcome of that meeting goes. So, that’s really why we have to wait. The Chairman of the NCP is the vice president and he is serious about this issue. We have brought out this issue of poor remittances as one of the cases before him. So, we have to wait for the conclusion of that meeting to know what next to do.”

Another source at the Power ministry told our correspondent that when the Transitional Electricity Market was declared, the expectation was that all the Discos would make 100 per cent remittance to the government.

The Managing Director, NBET, Mr. Rumundaka Wonodi, explained to our correspondent that it was important for the Discos to remit funds to the government now that power generation was gradually improving.

He said their failure to make stipulated remittances might result in a fall in power generation and that the government might not have enough funds to pay for generated electricity

“Generation is coming up and we need to be sure that money is being transferred from the distribution to the generation companies to incentivise generation. The gas suppliers are ramping up gas to the power industry; if the money does not get to the generation companies and they do not pay their suppliers, we may see supply falling,” Wonodi added.

Meanwhile, the Transmission Company of Nigeria has announced the attainment of an all-time maximum energy of 101,088 megawatt-hour wheeled through the national grid in a day.

The TCN said in a statement signed by its General Manager, Public Affairs, Mrs. Seun Olagunju, that the feat was recorded on Wednesday, August 5, 2015.

The company’s previous highest wheeled energy of 99,450MWH was attained on October 31, 2014.