Report: Nigerians owes N90bn Electricity Bill Forcing Govt to Write-Off Debts Enough to Build Power Plants

Report: Nigerians owes N90bn Electricity Bill Forcing Govt to Write-Off Debts Enough to Build Power Plants

  • Nigerian electric regulator has cried out that many electricity consumers both local and international are owing billions
  • Government MDAs account for the largest share of outstanding bills including neighbouring countries
  • The poor remittance the regulator stated is affecting how efficiently it operate in meeting electricity demands

According to a report by BusinessDay, out of every N10 worth of energy sold to Nigerians, as much as N3.47 remained uncollected.

This is according to its analysis of the Nigerian Electricity Regulatory Commission (NERC) latest report.

The report noted over N90.09billion is been owed by registered electricity consumers for electricity supplied from September to December of 2020.

Report: Nigerians owing N4 for every N10 electricity supply, government agencies are worst
Nigerian electricity consumers are having a tough time Photo Credit: hassan
Source: Twitter

The amount owed is enough to build a 220-megawatt power plant using global market prices which puts the cost of building a one-megawatt power plant at $1 million.

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That’s more than enough to power all the government’s ministries, departments and agencies and just enough for the homes of 220,000 households or at least one million people with the assumption of four people per household.

What the report is saying

NERC noted that all the eleven DisCos supplied N259.90billion worth of electricity in the three months under review of which only N169.81 billion.

NERC said:

"These denote 75.70percent and 65.34 percent billing and collection efficiencies and indicate 0.92 percentage-point increase in billing efficiency and 1.38percentage points decrease in collection efficiency when compared with the corresponding period in Q3 2020."
“The financial viability and commercial performance of the industry continued to be a major challenge with a decline in Collection efficiency in 2020/Q4”
"During the fourth quarter of 2020, a total invoice of N245.91 billion was issued to the eleven DisCos for energy received from the Nigerian Bulk Electricity Trading Plc (NBET) and for service charge by the Market Operators, out of which a sum of N146.66 billion was settled indicating remittance performance of 59.64percent.

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The combined average remittance performances to market operators and NBET increased respectively from 94.25percent and 26.81percent in the third quarter of 2020 to 99.99percent and 48.46percent in the fourth quarter 2020.

Foreign consumers

NERC also noted that during the last quarter of 2020 international customers received a total invoice of N4.12billion ($13.73million) from MO and paid the sum of N7.39billion ($24.12million) for the current and outstanding invoices for the services received from MO.

The international customers includes Société Nigerienne d’electricite –NIGELEC, Societe Beninoise d’Energie Electrique – SBEE and Compagnie Energie Electrique du Togo–CEET).

More debt

For special customers (Ajaokuta Steel Co. Ltd and the host community) no payment was made for the N0.18billion and N0.02billion energy invoices and service charges issued by NBET and market operators respectively.

NERC also said there is huge non-settlement of energy bills by MDAs across the three tiers of government (i.e., Federal, State and Local Government).

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NERC said:

"The MDAs debts is one of the major contributory factors to high ATC&C losses, and hence poor liquidity, must be urgently addressed as part of the ongoing Federal Government’s efforts towards ensuring financial sustainability of NESI"

List of areas to be mostly affected by power outage had earlier reported how many Nigerian homes are set to enter the new year without power as power generation drops again significantly.

To date, the highest peak power generated according to the Nigerian Electricity System Operators is 5801.6MW when Nigerians need over 19,000MW.

From the little power generated, TCN share to 12 distribution companies across Nigeria serving the 36 states.


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