The poor remittance by electricity distribution companies to the Nigerian Bulk Electricity Trading Plc for the energy sold to them has become a serious concern for the regulator of the power sector. The government-owned NBET buys electricity in bulk from generation companies through Power Purchase Agreements and sells to the Discos, which then supply to the consumers.
The Nigerian Electricity Regulatory Commission, in its report for the second quarter 2018, noted that the liquidity challenge in the Nigerian electricity supply industry continued to manifest during the period under review. It said this was evidenced in the Discos’ level of remittances to NBET and the market operator, as compared with the invoices received for energy purchased from NBET and those received for administrative services from the MO.
During the second quarter, the Discos were issued a total invoice of N161.4bn for energy received from NBET and for the administrative services by the MO, but only a sum of N53.7bn of the invoice was settled, creating a total deficit of N107.7bn. To address the poor remittance by Discos, the commission said it had commenced enforcement actions against Discos found to have engaged in unacceptably low remittances to NBET and the MO, factoring in all the parameters embedded in the tariff model.
Source: The Punch