Dr Joy Ogaji, Executive Secretary, Association of Power Generation Companies (APGC), last week, revealed that generation companies were being owed about N1.75 trillion for power generated for the electricity market since 2013.
Ogaji spoke during a panel session at the Association of Energy Correspondents of Nigeria (NAEC) Strategic International Conference in Lagos. The session’s topic was: ”Power Sector Dilemma: Issues, Challenges, Opportunities and Strategic Key Solutions.”
She said the liquidity challenge of the Nigerian Electricity Supply Industry had made operating in the generation value chain very difficult for the companies.
Ogaji said GenCos were currently owing their gas suppliers about N1 trillion and servicing loans used for acquiring the companies in 2013.
She said the Nigerian Bulk Electricity Trading Company (NBET) needs to intensify efforts to ensure remittances by the 11 electricity Distribution Companies for energy consumed by their customers.
Ogaji said GenCos were ready to generate the power needed in Nigeria, but utilisation had stagnated in the country for a long time due to transmission and distribution constraints.
“Just to give you a context, on November 1, 2013, when the privatisation took place, power was 3,427MW on the day of the takeover.
“On December 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.
Ogaji said, however, that the average uptake of power from the GenCos was about 4,000MWh from 2013 to date which was not good for business.
“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 incentivised to produce and this is a major problem,” she said.
Ogaji also decried the lack of access to foreign exchange by GenCos which had become a significant challenge to their operations in recent times.