Poor power supply: Discos owe NBET N103bn


Despite the N72 billion credit granted the Distribution Companies (Discos) to enable them take off enough energy from Transmission Company of Nigeria (TCN), Nigerian Electricity Regulatory Commission (NERC) yesterday, disclosed that Discos are still owing Nigerian Bulk Electricity Trader (NBET) over N103 billion.

In its third quarter report 2017, NERC said during the three months under review, that Discos paid N44 billion from N147 billion invoice issued by NBET, leaving a shortfall of N103 billion. The report also showed that there was low revenue collection efficiency by the Discos as well as consumers’ poor response to paying bills, adding that out of N151.7 billion electricity bills issued to customers, N90 billion was recovered.

According to the Commission, the key initiative towards improving revenue collection in the electricity industry is the provision of meters to all end-use consumers.

“During the period under review, Discos were issued an invoice totaling a sum of N147 billion for energy received from NBET and for the service charge by the Market Operator (MO) but only N44 billion was settled, creating a shortfall of N103 billion,” the report stated.

“To address the liquidity challenge in the electricity industry, with particular emphasis on the poor remittance by Discos, the Commission is currently working on a framework to ensure a fair and equitable distribution of market revenues. The framework aims at ensuring transparency and fairness in the utilisation of market funds.

“The Discos collectively billed a total sum of the N151.75 billion during the period under review but only N90.30 billion was recovered through collections. This represents an average of 55 per cent collection efficiency thus implying that of every N10 worth of electricity sold during the quarter, N4.50 remains uncollected from customers.

“A major factor contributing to low collection efficiency is customers’ dissatisfaction with estimated billing. The Commission has initiated a regulation to fast-track the roll-out of meters by potential investors under a financially-viable and bankable arrangements,” the Commission said.

On May 10, 2018, the Federal Government, in a bid to improve power supply, provided N72 billion financial facility to Discos which, though was a loan, would be converted to an equity.

According to the Discos’ privatisation terms, the government has 40 percent shareholding in them while the core investors of the Discos maintain 60 per cent shareholding.

Also, the government indicated that TCN would be the source of the facility as well as its manager.


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