The 11 electricity distribution companies (Discos) in Nigeria’s electricity supply industry have claimed that they are currently losing an average of N10 on every kilowatt hour (kwh) of electricity they distribute to homes and offices in their networks.
The Discos also said they have been unable to borrow funds to invest in their networks because of the deficit status of their respective balance sheets. The Executive Director, Advocacy for the Association of Nigerian Electricity Distributors (ANED), Mr. Sunday Oduntan stated they would want the government to legally recognise the current electricity market shortfall as a deferred income which could help them re-engineer their balance sheets to be bankable.
Oduntan explained that the current shortfall had reached N809.8 billion, and that the Discos have been operating on a deficit for a long time now. He further said the pegging of capital expenditure in the tariff at N20 billion was a challenge to the Discos because they would not be allowed to spend more than that annually on capital projects. He explained that with this peg, the Discos would be unable to conclude their metering plans in the sector, as well as expand their network reach.