The Executive Secretary, Association of Power Generation Companies (APGC), Dr. Joy Ogaji that since 2013 powers generation firms being owed ₦1.75 trillion in deficit for electricity generation.
Ogaji made this disclosure at a panel discussion at the Association of Energy Correspondents of Nigeria (NAEC) Strategic International Conference held in Lagos.
The session’s topic, according to the News Agency of Nigeria (NAN), was: ‘Power Sector Dilemma: Issues, Challenges, Opportunities, and Strategic Key Solutions.’
According to her, functioning in the production value chain for the firms had become extremely challenging due to the Nigerian electricity supply industry’s liquidity challenges.
Ogaji pointed out that, GenCos are currently servicing debts being used in acquiring the companies in 2013 and owe their gas suppliers over N1 trillion.
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She stated that in order to assure payments from the 11 power distribution firms for the energy used by their clients, the Nigerian Bulk Electricity Trading Company (NBET) needs to tighten up its efforts.
Ogaji claimed that while GenCos were prepared to supply Nigeria with the electricity it required, usage in the nation had long since stalled as a result of transmission and distribution challenges.
‘Just to give you a context, on Nov.1, 2013 when the privatization took place, power was 3,427MW on the day of takeover.’
‘On Dec. 1, 2013, power had gone from 3,427MW to over 4,003MW and by 2020 it had gone up to nearly 8,000MW,’ she said.
However, Ogaji reported that from 2013 to the present, the average amount of power purchased from GenCos was close to 4,000MWh, which was detrimental to the company.
‘So, this does not encourage any investor to keep investing because clearly it shows that your product is not needed.’
‘Notwithstanding how Nigerians are always saying give us power, but generation production is driven by demand.’
‘When demand is not moving in line with the production, the producer is not incentivized to produce and this is a major problem,’ she said.
Ogaji also bemoaned GenCos’ inability to receive foreign currency, which had recently become a major impediment to their activities.