Despite the Federal Executive Council (FEC’s) approval of N701billion for the Nigeria Bulk Electricity Trading Company (NBET), as a power purchase guarantee fund, it still owed Generation Companies (GenCos) over N31.7billion as at May, The Guardian reports.
NBET is charged with bulk electricity trading, and buys power from the GenCos. The Federal Government in early March, approved the N701billion through the Central Bank of Nigeria (CBN), to resolve its liquidity crisis and facilitate payments to GenCos for power purchased. But documents revealed that in May, out of GenCos invoices worth N44.47billion presented to NBET for payment, only N12.77 billion representing 28.71 per cent of the total was approved. This left an outstanding indebtedness of N31.7 billion or 71.29 per cent.
Apart from this amount, the Executive Secretary of the Association of Power Generation Companies (APGC), Dr. Joy Ogaji, had calculated the arrears of debts owed to GenCos by NBET at over N500billion. She said such protracted debts inhibit GenCos from paying for gas supplied by Gas Companies for power generation and further investment in the power sector. This implies that GenCos are operating below installed capacities and thus, hindered from increasing power output necessary to boost socio-economic activities.