The inability of Distribution Companies (DISCO’s) to remit money collected to the Market Operators (MOs) and Nigeria Bulk Electricity Trading Plc. (NBET) is hindering stable power supply in the country, a former President of the Nigerian Society of Engineers (NSE), Mustapha Shehu has said.
He stated this in Abuja recently while speaking on the theme ‘Energy Situation In Africa: Opportunities and Challenges’ at the NSE 26th October lecture.Shehu, who is also the immediate past President of the Federation of African Engineering Organizations (FAEO) further disclosed that out of N449bn total invoice for Market Operators (MOs) and Nigeria Bulk Electricity Trading Plc (NBET) in 2016, Distribution Companies (DISCO’s) only remitted N127 billion, amounting to 28 percent only.
This comes as the National Assembly has pledged to enact laws that will make it mandatory for DISCOS to remit all money collected across the country to NBET and MOs.He noted that the failure to make remittances to MOs and NBET as well as the inability of Generating Companies (GENCO’s) to pay fuel suppliers may lead to a financial crisis including bank failures considering the volume of cash involved and the exposure of Nigerian banks to the sector.
He added that the failure of GENCO’s to pay for fuel denied suppliers the needed funds to maintain their plants and expand their networks adding that most of the operators have delinquent credit exposures to banks.
Giving a breakdown of the remittances by the Discos, Shehu stated that Abuja remitted N18m out of N61m; Benin remitted N12m out of N40m; Eko remitted N19m out of N39m; Enugu remitted N13m out of N50m; Ibadan remitted N18m out of N56m; Ikeja remitted N21m out N57m.
He further noted that Jos Discos remitted N4m out of N23m; Kaduna remitted N6m out of N38 m; Kano remitted N3m out of N29m; Port Harcourt remitted N6m out of N39m while Yola remitted N2m out of N12m.
He explained: “In Nigeria, the privatisation exercise aimed to improve the expansion and operation of the sector has not yielded the desired result economically as the Discos do not remit payments for energy supplied which sends very bad signal to prospective investors as there is no business that can thrive and grow if service rendered are not paid.”
He maintained that development of the energy sector is inter-related with 12 out of the 17 Sustainable Development Goals (SDG’s) adding that meeting up with the SDG’s would be an illusion if the continent failed to address energy deficit.
Speaking at the occasion, the Senator representing Kano Central, Rabiu Kwankwaso assured that the National Assembly would make laws to ensure that poor remittance by DISCO’s and other issues bordering on electricity are properly addressed for effective power supply in Nigeria.
Shamsudden Usman, who was the special guest of honour, said that Nigeria never lacked adequate plans that the problems lies in implementation of government plans and policies.
Usman who was the former minister of National Planning regretted that Nigerians failed to hold government accountable on their promises saying that the first primary assignment of any government is to improve the quality of life of its citizens.