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Tag: GENCOs

  • DisCos low remmittances inhibits NBET

    The Nigerian Bulk Electricity Trading (NBET) Plc yesterday blamed its inability to meet its obligation to electricity generating companies (GenCos) on the low remmittances from the power firm which is  between 25 and 30 per cent.

    Due to the shortfall, the GenCos too cannot meet their obligations to their gas suppliers.

    The NBET Managing Director, Dr. Marilyn Amobi, disclosed this in a note to The Nation in Abuja.

    The note which was endorsed by Mr. Ibrahim Saliu on behalf of NBET CEO, explained that the Nigerian Electricity Regulatory Commission (NERC) is already looking into different ways to solve the liquidity challenge in the electricity market.

    Amobi said: “The Nigerian Electricity Supply Industry (NESI) is still facing severe liquidity challenges. Remittances from the DisCos to the market still hover around 25-30 per cent of their invoices.

    “This makes it practically impossible for NBET to meet its payment obligations to the GenCos and which in turn constrains the ability of the GenCos to meet their obligations to their respective gas suppliers. The government, through the industry regulator, NERC is examining various ways to address this liquidity issues.”

    The Executive Secretary, Association of Power Generation Companies (APGC), Barr Joy Ogaji, confirmed yesterday that the liquidity issue in the industry was yet to abate.

    “Nothing has changed. The payment issue has not changed,” she said in a telephone interview.

    Ogaji had also said gas suppliers such as Total and Shell Petroleum Development Company (SDPC) had shut their supply to four gas companies for failure to pay their gas debt.

    She said the GenCos are looking forward to hearing from the Minister of Power, Works and Housing, Babatunde Fashola and NERC in terms of the sector’s policy direction.

    She said: “We are yet to hear the policy direction from Fashola and NERC.”

    She had early this year said the N701billion Power Assurance Guarantee intervention for the GenCos got finished in December 2018.

    The Ministry’s Permanent Secretary, Dr. Louis Edozien that commented on the payment of shortfall to the GenCos in NERC workshop on eligible customers on February 12, said it is not the responsibility of government to pay for GenCos’ shortfall.

    According to him, the government that paid the intervention through NBET will now exit from playing the role.

     

    Edozien said that “In addition to that 2,000 MW,  the 4,000mwh that is consistently being delivered is not fully paid for. Government through the nation’s insurance Programme is paying the generation companies for any shortfall payment from NBET.

    “Clearly that is not what act intends the industry to be. And ultimately government has to exit from this role.”

    Amobi that The Nation asked to comment state whether there is a fresh government intervention for the GenCos, said that “NBET is not the approving authority for power sector intervention funds. If a decision is taken by the appropriate authority on it, the information will be made public.”

     

  • FG stops payment of GenCos shortfall

    …urges evacuation of stranded 2,000mw for revenue

     

    The Federal Government on Tuesday announced its exit from the payment of the shortfall for the 4000mega watts per hour (mwh) to the Electricity Generation Companies (GenCos).

    According to the Permanent Secretary, Ministry of Power, Dr. Louis Edozein, who broke the news to stakeholders at the Nigerian Electricity Regulatory Commission (NERC) workshop on Eligible Customer Regulation in Abuja, the Electric Power Sector Act does not make provision for the Nigerian Bulk Electricity Trading Company (NBET) to pay for the shortfall to the GenCos.

    He told the stakeholders that in line with the contractual agreements, it is the consumers, who should pay for the power they consume.

    His words: “In addition to that 2,000 MW, the 4,000mwh that is consistently being delivered is not fully paid for. Government through the nation’s insurance Programme is paying the generation companies for any shortfall payment from NBET.

    “Clearly that is not what act intends the industry to be. And ultimately government has to exit from this role.

    “So, it is this regulation that will ensure that not just stranded power but delivered power, is delivered to consumers who are contractually bound to pay for it. And if they do not pay for it they do not enjoy the service.”

    The Permanent Secretary noted that it is obvious that there is more generation than the consumers can pay for, noting that the solution is for the stakeholders to look for the customers that are not well served under the Eligible Customers Regulation to take it and pay for it for their benefits.

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    He submitted that “if we do this aggressively, that 2,000mw of so-called stranded generation will quickly evaporate.”

    He told the stakeholders to look for customers to buy the stranded power because it is inappropriate for government to continue to pay for the power.

    According to him, government cannot perpetually pay for their power consumption.

    Edozein also told the Transmission Company of Nigeria (TCN) to stop the complaint about non-increase of tariff to the NERC and work with the GenCos to get willing customers to buy the available power.

    He said that “I have a message also for TCN: stop complaining to NERC about your tariff. Your job is to satisfy your own customers that is GenCos and DisCos.

    “Work with them as you have the money to find all customers using this policy who will take the power GenCos have, contract with GenCos at a tariff that you, the GenCos and customers agreed to transmit the power close to the customers. That is the way you will raise your revenue.”

    The Permanent Secretary urged the DisCos to satisfy their customers in order to encourage them to pay for the service.

    He explained to the DisCos that the reason the customers would want to take advantage of the eligible customer regulation is when they are not satisfied with the services rendered to them by the DisCos.

    He said “So DisCos this is your opportunity to service your customers better. Listen to them when there is infrastructure challenge in getting the product to them.”

    There was however a mild drama as the Deputy Managing Director, Ibadan Electricity Distribution Company, Engr. John Ayodele counted the Permanent Secretary on stranded 2,000mw.

    He told the stakeholders that there is no stranded 2,000mw anywhere in the Nigerian Electricity Supply Industry (NESI) but the Executive Director, Mainstream Energy Solution Limited, Mr. Siraj Abdullahi, insisted that his company, Kainji Power Hydro habours some stranded power.

    He challenged the stakeholders to come visiting the plant to observe the stranded power.

  • Shell, Total cut gas supply to GenCos over debts

    Four gas generating companies (GenCos) have shut down production as a result of their failure to pay gas debts owed Shell Petroleum Development Company (SPDC) and Total, as well as their inability to access fresh loans for gas, The Nation learnt yesterday.

    Consequent upon the liquidity issue that has now exposed the GenCos to over N1trillion shortfall, some of the GenCos have now resorted to securing credit facilities from commercial banks to sustain their production.

    The Executive Secretary, Association of Power Generation Companies (APGC), Joy Ogaji, who spoke on phone yesterday, said the power plants shutdown production due to lack of access to take loans.

    Asked to mention the four power generating firms that have stopped production, she declined, stressing that the companies would not want their names mentioned because of it is political season.

    She said: “Some of the GenCos that can access loans have resorted to taking loans to buy gas. Others that don’t have access to such loans are shutting down. Shell and Total have shutdown some of the power plants; they want the power plants to pay them.

    “From what we got, it is about four plants. Some of them don’t want their names mentioned. You know it is political season now.”

    Meanwhile, at 6:00 hour of yesterday, power generation was 4,069.90Mw. It was 4,092.1Mw on December 29 last year and 3,806.0Mw as at January 2.

    According to the Minister of Power Works and Housing, Babatunde Fashola, the power sector now generates 7000Mw as a result of the N701billion Power Assurance Guarantee.

    But Ogaji had on Monday raised the alarm over the liquidity challenges facing the electricity generation companies otherwise known as Gencos , saying that their current shortfall has exceeded N1trillion.

    Speaking with The Nation on phone, she noted that the N701billion Power Assurance Guarantee, which the Federal Executive Council approved for the companies in the first quarter of 2017, has been exhausted.

    According to her, there was a high hope that the Federal Government would make the electricity distribution companies (DisCos) pay at least 80 per cent of their invoices but the government has not realise it.

    She said: “The major problem that the generation companies are facing now is that of liquidity. The N701billion is over. The government has not succeeded in making the DisCos to pay at least 80 per cent of their invoices. The N701billion got finished in December. We don’t know how the Gencos will survive.”

    Insisting that the major problem confronting the companies is that of liquidity and not gas supply, she noted that the GenCos have not exhausted their present allocation of gas to power.

    The inability to pay for the gas, according to her, is responsible for the low utilization of gas.

    Continuing, she said “we have neither been able to pay for gas nor provide the gurantee.”

    The Executive Secretary, who was asked how the increase in the fine or penalty for gas flaring has affected the supply of gas for power, described the regulation as a welcome development, which does not in any way make any difference in the gas to power.

    The Minister of Power, Works and Housing, Babatunde Fashola had late last year told reporters in Minna, Niger State that owing to the Power Assurance Guarantee payment to Gencos, their monthly payment had risen 20% to 80%, bringing their production to 7,000mw.

    Meanwhile, the Managing Director, Transmission Company of Nigeria (TCN), Mr. Mohammed Gur Usman had in December told reporters in Abuja that the recent increase in the penalty for gas flaring by the Department of Petroleum Resources ( DPR) would lead to increase in gas to power to further boost power supply in the country.
    But Barrister Joy Ogaji insisted yesterday that liquidity and not gas is the problem of the companies.

    Meanwhile, the Nigerian Bulk Electricity Trading (NBET) Company, Dr. Marilyn Amobi Company Managing Director, whom The Nation asked on phone whether the Federal Government is planning another phase of power sector intervention for the GenCos, requested our Abuja correspondent to write a letter to request for the information.

  • GenCos yet to receive payment for electricity since June

    The Association of Power Generation Companies (APGC) says power Generation Companies (GenCos) have not received payment for electricity generated since June 2018 from the Nigerian Bulk Electricity Trading PLC (NBET).

    The Executive Secretary of APGC, Dr Joy Ogaji, said this in an interview with the News Agency of Nigeria (NAN) in Abuja on Sunday.

    Ogaji also told NAN that GenCos were owed N500 billion for power generated from 2013, when they took over electricity generation, to December 2016.

    “The GenCos debt is classified into about three categories, so when you are talking about debts, before even NBET came, market operators were owing GenCos.

    “If you calculate all that debt from 2013 to December 2016, GenCos debt were about N500 billion, this debt that we are talking about is without interest.

    “Because the Power Purchase Agreement (PPA) says if they delay to pay, GenCos are entitled to interest, so this amount is without interest, it does not also cover the cost for available capacity.

    “You know GenCos makes capacity available, so the power that is been rejected it does not cover that one, because that one is a different cost.

    “From 2017, NBET, through Federal Government’s Payment Assurance Guarantee has only been paying 80 per cent and there is 20 per cent short fall till date.

    “And for this year, since June we have not been paid,’’ Ogaji said.

    On GenCos meeting their obligation on payment to gas companies, he said: “GenCos have been taking loans from the banks to be able to meet their obligations in the market and put power on the grid.

    “Because when we don’t generate, we are called saboteurs they will start saying that the owners of the GenCos are PDP members that is why they are not generating.

    “But the government is not looking at the cost implication of putting power on the grid and you are not paying for it.

    “There is no business person that will want to continue business when you are not getting anything on it and upon that you are being accused that you are a saboteur.’’

    The APGC executive secretary, however, said GenCos were engaging NBET on the nonpayment since June.

    Reacting to alleged nonpayment of GenCos invoice since June, Head Corporate Communication of NBET, Mrs Henrietta Ighomrore, told NAN that comment on GenCos not receiving their payment for their invoice since June was not accurate.

    She said GenCos had always receive their payment as at when due, saying that at no time did NBET withhold payment to GenCos.

    “NBET do not retain any money, every money we receive from the DisCos, we immediately pay it to the GenCos to settle their invoices.’’
    She said it was important to understand how payments were made in the electricity market.

    “For instance, if you have January invoice, that invoice will be coming to you around end of February or early March.
    “Because when the generating companies generate and then they send to us and then we send to the DisCos.

    “Then all of these transactions at the end of the month, the Market Operator (MO) will now read the meter and will now raise the market settlement statement.

    “The MO will now send it to us, we will send to the GenCos and the GenCos will also receive it and send to us, then we will send to the DisCos, so the issue of not receiving payment since June, that is not accurate.

    “The thing is that most people in the electricity market don’t give very detail information, so you find out a lot of information outside are mere speculation.

    “You must understand that for instance, if I receive January bill by the time it will be getting to me will be around March by the time I will be making the payment it will be middle or end of the month.

    “But when somebody comes in March and says I have not been paid in January that is not accurate because there is no way you can pay January bill in January.

    “The settlement statement is read at the end of the month, and at the end of the month they are sent to the market participants.

    “So there is a time allowed for market participants to comment on the settlement statement.

    “That whole time lag in the sector is about 90 days from the time the meter is read, to the time the settlement statement gets to everybody and to the time payments is done,’’ she explained.
    Ighomrore, however, said through Federal Government’s provision of N701 billion Payment Assurance Guarantee loan, NBET had been making 80 per cent payment generation invoice of GenCos in the last 18 months.

    “One of the things that the GenCos have not always being saying is this, there is a N701 billion that Federal Government approved loan and we use it to top up payment to the GenCos.

    “And that is not part of their contract, but because of the nonpayment that DisCos receive, Federal Government now taught of raising additional payment supplement so that NBET can use it.

    “Now this loan that Federal Government gave to NBET is because of the low remittance that we get from DisCos, so that we don’t allow the GenCos to suffer because of the low payment from DisCos.

    “So when people say that NBET is not making payment, it is not a true reflection of what is happening in the market,” she said.

    On allegations of financial infraction leveled against NBET Management by an official of the company on a popular radio reality programme, the spokesperson said: “Unfortunately I have not listened to the transcript of the radio show, but there is no crisis in NBET, you can come to our office and see that everybody is going about their normal business.

    “In an office there may be internal and operational issues, those internal issues are things we attend to internally.

    “We have a policy manual; we have grievance procedure, if there is any body that is aggrieved, follow through the procedure and get result.

    “So we are more focused on delivering technical duties, the internal operational issues are not things that should be splashed on the pages of newspapers or radio stations.” (NAN)

  • GenCos reduce generation to 2,669mw over low-load demand

    The Nigeria Electricity Supply Industry (NESI) recorded a drop in its production on Independence Day as its generation was 2669Mega Watts (MW) on that day.

    From the Daily Operational Report that the Independent System Operator of the Transmission Company of Nigeria (TCN) posted on Monday, the electricity market had on the previous day recorded 89,043.86 MWH (3,710mw).

    But the peak generation for that day was 4,376.90mw, while the lowest generation was 3,225.40mw. The daily report indicated that the highest system frequency was 50.89Hz, while the lowest system frequency  was  50.17Hz.

    According to the report, highest voltage recorded was 354Kv and the lowest voltage recorded was 300kv.

    The Nation however gathered that the dip in generation occured on Saturday due to low load demand by the electricity  Distribution Companies (DisCos).

    The daily report of Saturday indicated that as at 06:00hours, the Gencos produced 3,535.1mw, but  the DisCos demanded for  2,672.6mw.

    The report added that as at “00:18hours, Delta GT20 was shut down due to low load demand by the DisCos, resulting to a Load loss of 70megawatts. Also as at 01:41:00hours, Sapele NIPP GtI was shut down due to low load demand by the DisCos, resulting in a Load loss equivalent of 68.5mw.”

    According to the report, as at “02:25hours-20:26hours, Delta GT15 was shut down due to low load demand by DisCos, resulting in a load loss of 80Mw.

    According to the report, Omotosho gas GT7 was sap with the GT8 as Omotosho GT8 was shut down and 25mw was transferred to GT7.

    The same day, said the report, Olorunshogo gas increased generation by 40Mw.

  • Fed Govt: GenCos planning to disrupt power supply

    The Minister of Power Works and Housing, Babatunde Fashola yesterday alleged that some electricity Generation Companies (GenCos) were planning to disrupt power supply to score political gains.

    He said a report to that effect is already with him.

    “Let me say it very clearly to some of these people that I get reports on some of the clandestine meetings they hold with the view to disrupt power supply for political capital.”

    He also said the power firms have dragged the Federal Government to court over its regulation, stressing that the suit coming at the time that there is increase in power supply is an indication of the intention of the plaintiff to blackmail the government and hold the citizenry hostage.

    He wondered “whether the period when this sector is now making progress does not suggest an intention to blackmail government and to hold the citizens hostage?”

    Fashola however promised to defend Federal Government’s position in the law court, where he has lived all his life.

    He spoke at the 25th Monthly Power Sector meeting in Uyo, Akwa Ibom State capital.

    The power firms had sued the Federal Government for discriminatory treatment against them and the gas suppliers. They claimed that the government’s was scheming to give Azura Power West Africa Limited and Accugas Limited to disadvantage of the entire power sector.

    The representatives of the GenCos in the suit at the Federal High Court, Abuja, are Mainstream Energy Solutions Limited, Transcorp Power Limited, Egbin Power Plc, and Northsouth Power Limited.

    Fashola however noted that only the power firms tabled their complaints to the ministry and dragged the government to the court only a week after that was not sufficient for the government to look into their grievances and react.

    He urged them to be fair in good conscience to the court of law and court of public opinion about the rival firms that they complained of. The minister submitted that the other new company has a partial risk guarantee in its contract which the plaintiffs do not pocess.

    Fashola tasked the plaintiff to be ready to tell the citizens how they felt first when other groups went to court to stop the implementation of tariffs approved by NERC.

    He said: “I was their supporter then asking Nigerians to bear with the tariff. You must explain to the court of public opinion whether they went to court before this government approved for them the N701billion payment assurance guarantee which enables them to receive payment on their monthly power bills.

    “When they are in that court, they must also tell the court that they are indebted to gas companies and to their banks because they were receiving less than 50 per cent of their bills. And in doing so, they must tell the court that they now receive 80 per cent of their bills from less than 50 per cent because the Buhari’s government intervened with the assurance guarantee.

    “They must also tell the court when they get there or while they are there that unlike before when they were paid in naira, from money that was received from international customers, we sell power to Niger Republic, Chad, Niger and Togo, under an international arrangement. They must tell the court that they are now receiving payments in dollars instead of in naira, which used to be the case.

    “They must also tell the court when they get there and also tell the court of public opinion that that there is a new GenCos  getting paid 100 per cent while they are getting 80 per cent. And they must explain to the court that the reason is that that new GenCo has a partial risk guarantee in its contract and they do not. They was the contract they signed.”

    But he said the genesis of the hatred in the sector was the introduction of the mini-grid regulation that the Nigerian Electricity Regulatory Commission (NERC)presented to the ministry last year making legal ways for competitive participation in power generation instead of the monopoly -like system that held the sector down for years.

    Yesterday however, Fashola recalled that the privatisation of the sector was not meant to replace government monopoly with that of private businessmen.

    He added that there was already progress emanating from the implementation of the regulation p, adding that “So if those people bother to look around them and they look at roof tops across Nigeria, you will see increased number of solar panel.

    “And the Nigerian Mini Grid Regulation we have issued  encouraged this to happen more and more and it will not stop. So for those who want to produce solar one mega watt and below we now have a regulation that allows,” he said.

    Fashola presented the Meter Asset Provider 2018 Regulation to the State Governor, Emmanuel Udom, making Akwa Ibom the first state to receive a copy of the regulation of the Nigeria Electricity Regulatory Commission (NERC).

    He recalled that the government pursued an out of court judgement in a case that lasted from 2013 to 2017 to get N39billion from a liability of N119billion.

    He said negotiations were still ongoing for fundings for rural electricification, mini-grid and DisCos distribution expansion financing that government hopes to complete before the end of the year.

    According to him, the Transmission Company of Nigeria (TCN) has continued its wheeling capacity, upgrade of its substations in partnership with the Niger Delta Power Holding Company.

    He reported to the stakeholders at the meeting that the Calabar substation has been completed and ready to be energized: Uyo substation is already completed and ready  to be energized in a matter of days. He said that substations in Karu, Nassarawa, Abeokuta among others have been completed and now in service.

    Fashola said it was no longer news that the sector has reached a 7,000mw generation capacity and now has 5000mw distribution capacity.

    He said in the last month the ministry met with the Manufacturers Association of Nigeria, DiscOs and GenCos and TCN on how to implement the eligible customer policy and increase connectivity to the 2,000mw now available.

    He said that the meeting was productive and “report reaching me is that is what is outstanding is agreement on the tariff that will be paid on the eligible customer.”

    Speaking the NERC commissioner, Dafe Agenife, who presented the Meter Asset Provider 2018 Regulation to the minister said that issues of availability of metering and estimated billings were recurring where the commission went to.

    He said that the commission had consultations with different stakeholders, agency and consumers on the regulation .

    He submitted that the findings was that NERC could not leave the task to the DisCos alone as other investors must come on stream, hence the Meter Asset Provider Regulation.

    The commissioner Before you today is the NERC Meter Asset Provider 2018,” adding that four years after privatization customers are still complaining which necessitated the regulation to have independent people approved by NERC and contracted by the DisCos  to bridge the metering gap.

    In bridging the gap, he said, customers will now have the option of self-financing, obtains meters from the asset providers to pay the metering service charge for a period of 10 years.

    The meter asset providers will also ensure that the meters are maintained 48hours should anything goes wrong with the meters, he added.

    According to him, it is estimated to produce an investment of over N200billion in  the next three years in the industry.

    The regulation, he said would create jobs owing to its 30% local content initiative.

  • Reps query Minister’s utilization of N22bn without result

    Reps query Minister’s utilization of N22bn without result

    The House of Representatives committee on Power Wednesday queried Nigerian Bulk Electricity Trading Plc over the utilization of N22 billion monthly on gas without commensurate result..

    Subsequently the lawmakers summoned the Minister of Power, Mr Raji Fashola over the violation of the 2017 Appropriation Act.

    In a bid to obtain relevant information, the Committee also summoned the permanent secretary, Mr. Louis Edozien and Managing Director of Transmission Company of Nigeria (TCN) to come along with the Minister.

    The minister is to give details on the activities of the power ministry as well as the level of procurement processes of each project.

    The Daniel Asuquo – headed committee summoned to Minister sequel to his absence at a hearing on the issue yesterday.

    While reacting to the submission of the Minister’s representatives, A member of the committee Toby Okechukwu criticized the indiscriminate injection of fund into the distribution companies by Federal Government.

    “I don’t know whether the acquisition of the distribution companies is worth more than N701 billion. The total capital of these companies may not be up to N701 billion. Yet we are borrowing money to support them and give NBET,” he said.

    Mark Gbillah, another member while doubting the liquidity of NBET and TCN, warned that if drastic action is not taken, the power sector faces imminent collapse in the next six to seven years

    His words: “We are trying to pay for the business of certain individuals at that level of gas and generation. We need to do a forensic study of these gas companies.

    “What are they actually generating? What are we always required to pay them? The generating companies always tell us a mongos figures of what they are generating, and how there’s no transmission capacity, the losses that they experience.

    “We need to start from the bottom up as well from the gas angle. Where are these monies going to? This question goes to the Permanent Secretary. What is the utilization of these funds and the level of generation along the value chain, the operating cycle from GENCOS to TCN and DISCOs?

    “Is this the best model in the world? I think NBET only came to complicate the issues in the centre of the value chain,”

    However, the failure of the permanent secretary who represented the Minister to provide detailed information requested by the committee on unauthorized spendings did not help matters.

    The allegation against the ministry was a source of concern to the lawmakers and the minister and the Managing Directors of the Nigerian Bulk Electricity Trading Company and Transmission Company of Nigeria were expected to furnish the committee with answers.

    As far as the committee was concerned, the ministry had frustrated the 2017 appropriation Act.

    The Chairman of the committee, Daniel Asuquo said that the committee had been mandated by the House to protect the interest of the citizens, adding that that the minister and his Permanent Secretary have breached the law.

    The power sector, he said, is poorly managed with a high level of impunity.

    He said: “We are not seeing the will from the Executive because all we see are the people who just want to put us in debt, debt and debt even without passing through due process, because TCN is a can a worm from our own overview.

    “We need to bring out this to the public for them to know the state of our power, we have parleyed too much.. How much of this can the distribution companies take.”

  • Fed Govt may hike electricity tariff

    Fed Govt may hike electricity tariff

    • • GenCos to NERC: add stranded 2,000Mw to capacity

    The Federal Ministry of Power, Works and Housing may bow to pressure from electricity distribution companies (DisCos) to hike electricity tariffs as one of the solutions to resolve the crises in the power sector.

    The Permanent Secretary, Ministry of Power, Louise Edozien, who gave indication to this yesterday in Jos, lamented that low tariffs remained a stumbling block on the way of developing the power sector.

    He spoke during the opening ceremony of the third National Council on Power (NACOP) meeting held at Crest Hotel and Garden Jos.

    The theme of the meeting is: Completing power sector reforms.

    He said: “I will like to focus on two major challenges of the sector. The first one is how to deliver available power on the grid to consumers, and the second is the problem of debts and other related issues of collection and tariffs.

    “The tariff is too low, and some consumers still don’t pay their bills, in part because the DisCos have not metered them; so they are not sure they are paying for only what they have consumed. So, the DisCos do not pay Nigeria Bulk Electricity Trading (NBET) its full invoice. NBET in turn defaults in payment to the generation companies (GenCos).”

    Meanwhile, the GenCos yesterday urged the Nigeria Electricity Regulatory Commission (NERC) to classify the stranded 2,000Megawatts (Mw) as part of the available generation capacity in the Nigerian Electricity Supply Industry (NESI).

    The Commission, according to its presentation on the review of the Multi-Year Tariff Order (MYTO) methodology by Senior Manager, Market and Rate, Abbah Tera, takes generation capacity as one of the criteria for review of tariff.

    Responding, the Executive Secretary, Association of Power Generation  Companies (APGC), Mrs. Joy Ogaji, said  the fact that the stranded capacity is not utilised does not mean that it is not produced by the GenCos.

    She noted that there is enough gas but the only constraint its cost, stressing that the GenCos should not suffer owing to the stranded power.

    She said: “We are not saying we don’t have enough generation. The only constraint that Nigeria is having is the cost of gas. We have over 2,000Mw sitting. The over 2,000Mw should be treated; it is available; GenCos should not suffer for it . In line with the review NERC should capture the stranded capacity.”

    Some of the stakeholders urged the commission to privatise the Transmission Company of Nigeria (TCN) since it is obvious that the Federal Government which operates it has proven inefficient.

    The Commissioner of Engineering Performance and Monitoring, Prof. Frank Okafor, however explained that the cost of funding the transmission network is too enormous for a private company to raise for the operation of the system.

    “It will be difficult to get investors that will fund the TCN,” he said.

    Besides, he said it might be difficult to secure the right of way for the network since it transverse so many states of the federation.

    According to him, government is borrowing from multilateral financial agencies to expand the grid since the amount of power delivery is not sufficient to raise the required revenue.

    The commission maintained that it has met with the TCN and DisCos in order to deliver the stranded power to consumers.

    but for the commission to get stakeholders’ inputs on (the frequency of the review) how often the review should be carried out.

    The stakeholders were also divided on whether the tariff should be reviewed bi-annually, monthly or yearly.

    NERC carries out a major tariff review every five years and minor review every six months.

    But speaking, representative of Mainstream Energy Solutions Limited, Musa Abba Bajoga, urged the commission to follow the global practice to “do what is done universally.”

    The President Hotel Owners Association of Nigeria, Dr. Ezeh Udeh told the commission to consider a yearly review since hotel rates are not reviewed monthly and that any price that rises in the country hardly falls.

    Network of Electricity Consumers Advocacy of Nigeria (NECAN),  Tommy Akingbogun, told the commission not to use its rate to kill investors.

    Edozien said: “Government, as part of the power sector recovery programme approved a N701.9 billion payment assurance guarantee to ensure NBET discharges its obligation to the GenCos.

    “Government has also audited the N27 billion debts owed by Federal Government ministries, department and agencies (MDAs) to the DisCos and is taking steps to pay it.

    “NACOP 2017 is taking place at an important moment in the journey. Our objectives are not met, so much remain to be done. NACOP 2017 is the appropriate forum to access our progress, reaffirm our commitment, examine the challenges of the moment and take decisions to overcome them to ensure this journey achieves the desired outcome.”

    Plateau State Commissioner for Water Resources and Energy, Jafaru Wuyep in his goodwill message on the occasion expressed delight on the proposed Infrastructure Marshall of the Federal Government for the protection of public facilities from vandals.

     

  • GenCos blame power sector woes on weak transmission infrastructure

    The Association of Power Generation Companies (APGC) Executive Secretary, Joy Ogaji, has blamed the woes of the power sector on the weak transmision infrastructure of electricity distribution companies (DisCos) and Transmission Company of Nigeria (TCN).

    In a telephone interview at the weekend, Ogaji said the GenCos have installed capacity of about 12, 500megawatts (Mw) that is not being used while the transmission capacity is put at 5,500Mw noting there is a great difference.

    She said: “If there are blackouts in parts of the country, then it is not from our station; it is not due to generation fall, we are generating enough and we have enough capacity.

    “So, I have the power and there is no transporter to transport it, and when you check the capacity of DisCos, they have only 4,600Mw capacity, and you have a producer who is producing up to 12,500Mw but the people to take it can only transport 5,500Mw. Then the retailers who take it to Nigerians can only take 4,600Mw.

     “So, what are we looking at? Are we serious? Under normal circumstances, if the GenCos have 12,500Mw, then the transmission companies should be able to have up to 14,000Mw because the capacity should exceed what is even available.

    “They are not even getting up to 10,000Mw. When will they be able to take this power? There is disparity, Nigerians need to start asking questions.

    “You say you are increasing power. Which power? If generators are generating, how do we get the power? You and I should know that power cannot be fetched in bottles and buckets and put on the shop for sale and everybody go and pick it. It has to be transmitted and it has to be distributed, if these things are not aligned, and synchronised how then can the promises come to be.”

    According to her, until the government starts putting all the necessary things in place, it will take some time to fix the Nigerian power sector.

    She said some people may be sabotaging the power sector but argued that if the sector is critically looked at, the DisCos don’t have the capacity to take the power that is being generated and the TCN does not have the network to transmit the power that is generated.

    On gas supply, Ogaji said the generators could not pay for gas because the gas sellers were selling it according to who could pay. Gas is still a problem, to them you pay before service; if you don’t pay they cannot give you she added.

  • DisCos seek probe of NBET, GenCos for alleged fraud

    • Illiquidity in power sector hits N1trillion

    The Association of Nigerian Electricity Distributors (ANED) called on the Federal Government to probe the Nigerian Bulk Electricity Trading (NBET) Plc over inflation of invoices to Electricity Generation Companies (GenCos).

    Its Director of Research and Advocacy, Mr Sunday Oduntan at a briefing in Abuja, said NBET and power generators  have to open their books for scrutiny.

    He called for immediate intervention in the power sector to make it more sustainable, stressing that the process for raising monthly energy invoices be made transparent.

    “The GenCos (are) inflating invoices especially on capacity charges. I just heard  about this for the first time last week although, over time we have been wondering that perhaps there is a magic somewhere or that some magicians were doing magic somewhere under the table.

    ANED urged the Federal Government to compel a transparent audit of market accounts noting that  DisCos can’t continue to pay for GenCos’ investments when such costs cannot be passed to electricity customers.

    “If there is any kind of fraud, then it is time to address it. We have invoices to show for it and if we haven’t confirmed it, we won’t be talking about it.