GenCos Have Over N400bn Still Owed Them By FG

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The Federal Government has an accumulated debt profile of over N400bn with the Power Generation Companies (GenCos). This debt spans a period of 3 years (November 2013 to November 2016). This was disclosed by Mrs Joy Ogaji, the Executive Secretary of the Association of Power Generation Companies (APGC)
She gave details of companies and the specific amounts they are being owed: Egbin Power PLC is owed N93 billion and Niger Delta Power Holding Company (NDPHC), N105 billion.
Ughelli Power Company ( N50 billion ), Geregu Power Plant( N80billion), Kainji, Jebba and Shiroro Hydro power plant (N30billion).
The amounts, according to her do not include the debts owed Olorunsogo and Omotosho power plants.
The Executive Secretary appealed to the Federal Government to see to clearing the debts as the shortage of funds in the Gencos has made it difficult to pay salaries, purchase the gas needed to run some of the plants as well as meeting other obligations.
“The generation companies can no longer pay salaries; they can’t even pay for gas and the gas companies are no longer selling the product to them, as a result of the debts. Banks are not ready to advance credit to the GenCos again. This means that the power firms cannot get money to buy gas. Also, banks are not sure of getting their money back from the GenCos, even when they offer them facility.”
She stated that contractors were beginning to pull out as they are being owed. Mrs.Ogaji said GenCos stood the risk of packing-up if the current trend is not addressed and resolved.
Mrs Ogaji said: “When generation companies were invited to buy these assets, the government promised that the bulk trader set up to take the power said the GenCos should not worry about payment, but now the bulk trader is not paying up these debts,’’ adding that the GenCos didn’t have any contract with the DisCos.
She said the association was engaging the government at various levels and working out lasting solutions to the sector’s problems.
NDPHC General Manager, Corporate Communication, Yakubu Lawal, confirmed that the company was being owed about N100 billion.
To boost their revenue base, he urged the government to prevail on DisCos to meter their customers and be active in revenue collection, adding that there were many people not captured by the DisCos and, as a result, get estimated bills, thereby making the DisCos lose money.
Lawal maintained that there was the need for DisCos to meter their customers, adding that it would help to increase their revenue.
He urged the government to raise some bonds for investors to access loans to continue their businesses.
Source: Spark
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