OrderPaperToday – The Senate Committee on Power has informed that the Government Ministries, Departments and Agencies (MDAs) are owing Distribution Companies (DISCOs) the sum of N98 billion.
This was disclosed by the Chairman of the Committee, Senator Gabriel Suswam (PDP, Benue) at the end of three-day investigative public hearing on Power sector on Tuesday.
According to him, insolvency is the problem of the country’s deteriorating power sector.
He further noted that the Niger Delta Power Holding Company (NDPHC), lamented non-payment of N190 billion worth of electricity which was generated from the power plants to the national grid.
Suswam said: “The problem in the sector is insolvency. The DISCOs are unable to collect money from MDAs, owing about N98 billion now aside the ones owed by individuals.
“There are a lot of issues and those issues must be aligned. And that is what we’re trying to do in this public hearing”.
Another issue in the sector highlighted by Suswam is lack of coordination among key players in the sector.
“We have listened to presentations from the government side and the operators and we have seen that there is no alignment anywhere and that is the problem.
“The blame game among them has to stop. Once there is an alignment and proper coordination, that yes, if we generate 13,000 megawatts, and transmission is able to transmit at least 10,000 megawatts, and DISCOs are able to absorb the 10,000, and there is proper tariff, it makes the sector solvent.
“Once there’s money in the sector, the other potential investors will come in. The banks will be able to also put in more money, so that the sector will begin to run on its own.
“But where we are now, it will be unthinkable that government will stop providing the intervention. Once that stops, everything will collapse”, he said.
Speaking more on the debt being owed to NDPHC, the Managing Director of Niger Delta Power Holding Company ( NDPHC), Mr Chiedu Ugbo said: “The overarching challenge for NDPHC is the low market remittance leading to huge indebtedness to NDPHC.
“As at May 31, over N190billion was owed to NDPHC for electricity generated from our power plants to the national grid.
“The breakdown of the indebtedness is as follows: Legacy debt period: 2011 – 2013 N24,488,365,072. Interim Rule Period: 2013 – 2015 N6,796,473,564. TEM (NBET) : 2015 – 2020 N281,101,92,728. SUB-TOTAL N312,386.741.364. Less payment to gas suppliers: N119,393.845,935. This amounted to a total of N192,992,895,429 owed NDLHC.”