International consumers owe power firms $100m – FG

International electricity consumers who get their supply from Nigeria owe the power producers $100m (N30.5bn at the official exchange rate of N305 to a dollar), the Federal Government has said.

This is coming as findings showed that power generation was hampered in the past one week in about eight plants due to high frequency constraints caused by loss of feeders belonging to some electricity distribution companies.

Documents obtained in Abuja on Friday, containing the minutes of the recent 16th power operators meeting that was chaired by the Minister of Power, Works and Housing, Babatunde Fashola, as well as sector activities in the past week, showed that producers of electricity and service providers in Nigeria were being owed billions of naira.

The minutes, compiled by the Federal Ministry of Power, specifically stated that a report on the debt being owed the power producers had been submitted to the minister.

The Permanent Secretary, FMoP, Mr. Luis Edozien, according to the minutes, also directed the Transmission Company of Nigeria and the Nigeria Bulk Electricity Trading Plc to work together to recover the money ($100m).

It said, “The NBET informed the meeting that the report on international customer payments had already been submitted to the Chairman (Fashola) and that the report contained all reconciliation with Market Operator and novation agreement.

“The permanent secretary (power) confirmed receipt of the report. He stated that a meeting between the TCN and NBET took place with a view to addressing the arrears of $100m due to international customers. He suggested that the differences in opinion between the TCN and NBET should not affect the recovery of the outstanding balance.

“He advised the TCN and NBET to collaborate and recover the outstanding balance and execute the novation agreement. NBET informed the meeting that a letter had been written for the managing directors of the TCN and NBET to sign on the payments.”

It was reported earlier this year that the Republics of Benin and Niger paid $159,773,116.61 (N48.84bn at the official exchange rate of N305.7 to a dollar) as electricity charges to NBET.The meeting, therefore, directed NBET to forward a detailed report on the payment by NIGELEC, a power firm of the Republic of Niger and CEB of the Republic of Benin, as well as the outstanding balance on international customers to Fashola so as to enable him to brief the President.

The Federal Government had at the time stated that both countries had a combined balance of $92,315,986.20 (N28.22bn) to pay to NBET, adding that the payments made were remitted to the power generation companies and service providers in Nigeria.

It stated that the two African countries made the payments through their power companies, NIGELEC of the Republic of Niger and Community Electric du Benin of the Republic of Benin.

Meanwhile, findings showed that power generation remained poor during the week, as it hovered around 2,600 megawatts and 4,100MW.

Industry reports showed that the instability in power production during the week was largely due to high frequency issues in the system occasioned by the loss of Disco feeders.

This, according to the sector’s National Control Centre, led to generation constraint in eight power plants, which are Shiroro, Kainji, Jebba, Odukpani, Geregu I, Omotosho I, Olorunsogo II, and Transcorp Ughelli.

The NCC also stated that line constraint to power generation was observed in two other plants and announced that the Transamadi station had been restored to the grid following outage since November 20, 2016.

In one of its reports during the week, it said, “High frequency due to loss of Disco feeders remains a significant constraint to generation in Shiroro, Kainji, Jebba, Odukpani, Geregu I, Omotosho I, Olorunsogo II, and Transcorp Ughelli. Also, there were increased line constraints at Olorunsogo I and Ibom.”

Further findings showed that the sector lost about N1.3bn daily during the week as a result of constraints to power generation, while an average of 1,400MW of power was not generated due to high frequency issues.