The much touted N701.9 billion Payment Assurance Fund (PAF) meant to provide more liquidity for Generation Companies (GenCos) to pay for gas and increase electricity supply, has not been released five months after it was announced, Daily Trust reports.
The fund from the Central Bank of Nigeria (CBN), announced in March by Minister of Power Babatunde Fashola, is for the Nigerian Bulk Electricity Trading Plc (NBET) to bridge GenCos’ liquidity issues from January 2017 to 2019 to ensure more gas supply and increased power generation. In June 2017, the minister said the payment had commenced with visible improvement in power generation. The Permanent Secretary for Power, Mr Louis Edozien, at the July power sector meeting confirmed the payments to GenCos for January and February while those for March and April were being processed, under the N701 billion funding arrangement.
But in explaining the N701bn disbursement procedure to the GenCos, the spokesperson of NBET, Henrietta Ighomrore, confirmed the use of NBET capitalisation saying, “Rather than allowing gas constraints to continue, we had gone ahead to use some of our capitalisation with the understanding that it will flow back when the CBN fund comes.” Investigations have however shown that NBET was yet to access any tranche of the fund from the CBN as at yesterday. Even the payments made for January and February to the GenCos were drawn from NBET’s capitalisation.