Electricity generation companies received N311.06 billion for power supplied to the national grid in the first nine months of last year, which was 50 per cent of their total invoice, as the tight liquidity in the nation’s power sector persists.
The GenCos were paid N311.06 billion out of the total invoice of N614.58 billion, representing 50.61 per cent.
According to industry data released by the Nigerian Electricity Regulatory Commission (NERC), the payment to GenCos, which was made by the Nigerian Bulk Electricity Trading Plc (NBET), however, indicated an improvement compared to what the GenCos received over the same period in 2020 where NBET paid just 24.03 percent (N136.03 billion) of the N569.14 billion invoice sent in by the power generators.
A monthly analysis of data on NBET payments to GenCos from January to September 2021 showed that the electricity bulk trader paid N37.04 billion or 51.9 percent of the N71.37 billion invoice for energy supplied in January 2021.
The GenCos got N26.19 billion representing 39.6 per cent of the N66.15 billion invoice sent to NBET for energy supplied in February 2021. The payment for power supplied in March was N35.78 billion or 51.9 per cent of the N68.89 billion invoice sent to NBET.
Also, NBET payment for energy supplied in April was N39.46 billion representing 56.6 per cent of N69.65 billion sent in by the GenCos. For May, NBET paid the GenCos N40.54 billion or 55.3 percent of the N73.30 billion invoice for energy supplied.
In June, 2021, the GenCos were paid N31.88 billion or 48.1 per cent of the N66.20 billion invoice sent to NBET for energy supplied to the national grid. Also, NBET paid the GenCos N36.03 billion or 52.4 percent of the N68.71 billion invoice for energy supplied in July 2021.
In August, the GenCos were paid N31.14 billion representing 46.4 percent of the N67.16 billion invoice sent to NBET, while in September the GenCos got N32.99 billion or 52.2 percent of the N63.15 billion invoice sent to NBET for energy supplied.
The NBET implements the Minimum Remittance Order issued by the Nigerian Electricity Regulatory Commission (NERC) to all electricity distribution companies (DisCos), which sets the minimum percentage payment each DisCo is to remit to NBET monthly.
It is from the DisCos’ remittances that NBET pays the invoice sent in by the GenCos.
NBET in a statement in Abuja by Head, Corporate Communications, Henrietta Ighomrore said it would continue to deploy strategies and initiatives to enhance the market liquidity in the sector through improving payments to the generation companies, further supported by its power sector reform program and the market discipline committee.
NBET had in 2016 conceptualise and began the implementation of its N701.9 billion Payment Assurance Facility (PAF), when generation capacity was greatly threatened due to shortage of gas and the inability of some power generation companies to meet their immediate obligations.
NBET explained that the PAF was efficiently managed and disbursed from January 2017 till December 2018, and resulted in a quantum leap of 6500MW generation capacity to a 7659MW at the end of the PAF.
The success of the N701.9 billion PAF led to sustainable generation capacity and increased available electricity, this success led to the birth of PAF 11.
The implementation of PAF 11 which is N600 billion facility was implemented for 2019/2020, and later metamorphosed into the Power Sector Reform Program.
“NBET has consistently demonstrated efficiency and transparency in the administration of the financial flow”, the company added.
She further stated that NBET is committed to ensuring timely and efficient payment to GenCos to enable the generators to fulfill their obligations and maintain sustainable supply of electricity to the grid.
Ighomrore stated that NBET is engaging with all stakeholders in the value chain to ensure payment improvement and viability of the Nigerian electricity market.