PRESIDENCY TO PAY N2tn FROM N4tn ELECTRICITY BILL
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By: Jen Nomamiukor
The Presidency has initiated the process for the disbursement of ₦2 trillion from a total of ₦4 trillion in legacy debts related to electricity generated and supplied to the national grid.
A representative of the Special Adviser to the President on Energy, Olu Verheijen, announced at a Nigerian Electricity Supply Industry (NESI) stakeholders meeting organized by the Nigerian Electricity Regulatory Commission (NERC) that efforts are underway to settle debts within the upcoming quarter. This initiative is aimed at stabilizing Nigeria’s power sector.
The importance of settling debts within the power sector was emphasized, along with an exploration of alternative debt instruments in light of the Federal Government’s fiscal limitations.
The Coordinating Minister of the Economy, Wale Edun, along with the Debt Management Office (DMO), has expressed their support for addressing the financial challenges faced by Generation Companies (GenCos). Eriye Onagoruwa, representing Verheijen, indicated that internal approvals are in progress and emphasized the empathetic approach towards the GenCos’ situation, though specific timelines remain unconfirmed. Verheijen hopes to provide a more detailed update at the upcoming NESI meeting. This initiative comes in response to the GenCos’ warning regarding their accumulated debts, now exceeding ₦4 trillion, which include ₦2 trillion for 2024 and ₦1.9 trillion in legacy debts, posing a serious risk to the operation of their power generation facilities.
In February, Minister of Power Adebayo Adelabu announced that the Nigerian government owed over N4 trillion to electricity generation companies (GenCos) and distribution companies (DisCos), significantly crippling the sector’s performance. In a subsequent development, Adelabu pledged in April to address and resolve the issues related to these debts.
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