Power distribution companies failed to remit a total of N128.3bn to the Nigerian power market between January and June 2022, data obtained on Thursday from separate reports by the Federal Government’s power sector regulator showed.
Figures obtained from the Nigerian Electricity Regulatory Commission’s Q2 2022 report, which was published on Thursday, indicated that power companies did not remit N58.32bn in the second quarter of last year.
Furthermore, our correspondent’s findings from the commission’s first quarter report showed that Discos did not remit N69.94bn to the country’s power market during the review period.
The power sector regulator said power companies did not make outstanding remittances to Nigerian Bulk Electricity Trading Plc and Market Operator, an arm of the Transmission Company of Nigeria.
Providing an explanation on the energy market remittances in Q2, the NERC stated that the combined NBET and MO bills to Discos in Q2 2022 were N185.01bn, divided into generation costs: N149.89bn , while administrative and transmission services were put in place. at N35.12bn.
“Of this amount, the Discos collectively remitted a total sum of N126.69bn (N102.35bn for NBET and N24.34bn for MO) with an outstanding balance of N58.32bn,” the report stated.
He added: “This corresponds to a remittance performance of 68.48 percent during the quarter. The bad consignment is a direct consequence of the fact that the Discs registered an ATC&C (Technical Commercial and Collection Average) performance higher than that allowed as previously established”.
Meanwhile, data obtained by our correspondent from NERC’s Q1 2022 report on market remittances indicated that the combined bills from NBET and MO to Records in Q1 last year were N205.63 billion, split into generation costs: N164.860 million. ; while administrative and transmission services were N40.77bn.
“Of this amount, the Discos collectively remitted a total sum of N135.69bn (N109.96bn for NBET and N25.73bn for MO) with an outstanding balance of N69.94bn. This corresponds to a remittance performance of 65.99% during the quarter,” said the commission.
The liquidity crisis in the electricity sector has been repeatedly attributed to modest remittances from power distribution companies to the electricity market since the industry’s privatization in November 2013.
The president of the Nigeria Consumer Protection Network and the coordinator of Power Sector Perspectives, Kunle Olubiyo, told our correspondent that the incoming government must take a holistic view of the power sector.
In particular, it noted that the privatization of the successor generation and distribution companies to the defunct Power Holding Company of Nigeria in November 2013 should be reviewed.
This, he said, was particularly due to the dysfunctional output of power distributors since they were privatized, adding that the 10-year moratorium on privatizing the power sector would end this year.
Olubiyo said: “When this moratorium expires in October, naturally it will be without litigation because they have given the privatized companies 10 years. And so, if between the lines we try to change the goalpost, then a dispute can arise.
“If it weren’t for the activities of the banks that are now involved in the daily operation of some nightclubs, we would in no way have been able to bring out this last straw of impunity in the sector. People earn up to N15bn in a month and will still have a license for zero remittances.
“As consumers we are not paying our energy bills? For the generating companies, don’t they pay for the gas? And someone will collect money on our behalf and not remit it. So this privatization system cannot work and has not worked since the sector was privatized 10 years ago”.
The latest NERC report for the second quarter of 2022 also revealed collection efficiency by energy distributors in the second quarter of last year.
It read: “Total revenue collected by all Records in Q2 2022 was N188.29bn out of N265.68bn billed to customers. This corresponds to a collection efficiency of 70.87%, which represents an increase of 1.53 percentage points compared to the first quarter of 2022, where the average collection efficiency was 69.34%.
