Distribution Companies Owing GenCos Huge Amount as Remmitances Drop by 50 Per Cent

Distribution Companies Owing GenCos Huge Amount as Remmitances Drop by 50 Per Cent

  • Distribution companies in Nigeria are having hard times paying Generating companies the full amount due to them
  • According to available data, the distribution companies remitted about N35 billion out of the N75 billion indebted to the GenCos
  • The distribution companies receive tariffs from consumers which they remit to Electricity Supply Industry which then shares the revenues to the Transmission Company of Nigeria

Electricity distribution companies in Nigeria are not meeting up with paying generating firms' remittances accruable to them.

The Punch report says that payments to generating companies by distribution firms have dropped by 50 per cent since January.

Electricity companies, Power generating firms
DisCos owe Gencos a huge amount Credit: Bloomberg / Contributor
Source: Getty Images

Revenue shortfall trail GenCos

According to data, the distribution companies could not pay GenCos their full payment for the amount of power generated in January 2022.

PAY ATTENTION: Follow us on Instagram - get the most important news directly in your favourite app!

Read also

In 6 Months, MTN shareholders gain N35 billion as firm's market Cap hits N4.6 trillion

Due to the shortfalls, GenCos recorded a 50 per cent revenue decline.

Data breakdown shows that although the 26 GenCos sent out invoices to the tune of 76 billion, the DisCos could only remit N37 billion which is a 50 per cent drop in payment to the GenCos.

The distribution companies collect tariffs on behalf of the Nigerian Electricity Supply Industry, which shares the revenues with the GenCos and the Transmission Company of Nigeria (TCN).

Electricity companies owing huge amounts

GenCos mainly rely on gas for power production.

According to available data, Kanji received an invoice of N3 billion for January but got N1.5 billion as payment.

Jebba had an invoice of N4bn but received N2bn, Shiroro had an invoice of N3bn but got N1.7bn, while Egbin, the largest power plant in Nigeria submitted an invoice of N10bn, but got paid only N5bn.

Ughelli Transcorp submitted an invoice of N7bn in January but got paid a total of N4bn, and Sapele Power Steam had an invoice of N945m but got paid N478m. Geregu also got half payment of N4bn after submitting an invoice of N8bn.

Read also

FG, states finances in trouble, salary cut looms as NNPC again fails to remit N1.89trn crude oil sales revenue

AFAM IV-V and others got N609m payment out of a total invoice of N1.2bn. Olorunsogo also received payment of N1.4bn out of N2.7bn, Omotosho Electric N1.4bn out of N2.8bn, and Alaoji NIPP N481m out of N952m.

According to the Chairman of the Nigerian Electricity Regulatory Commission, Garba Sanusi, the DisCos, GenCos, and Transmission Company of Nigeria had committed to signing contracts to deliver N5000mw of electricity, starting from July 1.

Despite heavy investments, Nigeria now generates 3,900 megawatts of electricity

Legit.ng reported that Nigeria now generates about 3,904 megawatts of electricity for its over 200 million population.

The ministry of power said the current power generation is a marginal improvement, a statement by the ministry said on Tuesday, April 12, 2022, to bring it to 86,760.88MWH.

Power generation stood at 3,904MW as of Tuesday, April 12. 2022 before dropping by 1.96 per cent in comparison to 3,982.8MW recorded on Monday, April 11, 2022, a Nairametritcs report said.

Source: Legit.ng

Online view pixel