From Uche Usim, Abuja
Electricity Generation Companies (GenCos) yesterday lamented the acute shortage of Foreign Exchange (Forex) to acquire spare parts to service their heavy duty equipment.
The power firms, on the platform of the Association of Power Generation Companies (APGC), also complained of huge debt owned them by the Federal Government via two its agencies- the Nigerian Bulk Electricity Trading (NBET) Plc and Market Operator (MO), saying the two challenges were crippling their operations.
Speaking at a press conference in Abuja Tuesday, the Executive Secretary of APGC, Dr Joy Ogaji said the government should urgently looking into their plights as power generation plays a pivotal role in the growth of any economy.
She urged the Federal Government to create a window for them to access forex to ensure seamless power generation.
Mrs Ogaji said the 26 GenCos in the country have thrown their weight behind the Federal Government’s call for a centralised power revenue account, describing it as the right step taken to promote transparency in the power sector.
She noted that GenCos currently have 12,500 megawatts (mw) installed capacity and can generate 8,000mw on request.
“However, the national grid can only take 4,500mw at the moment. But the DisCos network has only 4,600mw capacity which has not been improved upon since they were privatised in 2013”, she stated.
According to her, 11 Distribution Companies (DisCos) who are trustees on revenue collection in the electricity market consistently remitted only 30 per cent of their monthly energy invoices that added to the liquidity constraints affecting the GenCos.
She described the power sector as a fragile value-chain that needs sufficient remuneration to cover cost of generation, transmission and distribution, as anything short of that will scorch the economy.
The GenCos, she emphasized, are entitled to 60 per cent remittance to pay for gas supply and transportation. “Transmission gets 11 per cent, distribution gets 25 per cent while the remaining four per cent is meant for regulatory charges and the Nigeria Bulk Electricity Trading Plc (NBET)”, she explained.
“The revenue referred to by the DisCos are not their personal revenue but market funds to which they were made trustees to collect and remit. The poor remittance of markets funds by the DisCos has prevented the rest of the value-chain from meeting up with their operations and also service their liabilities including gas payments.
“The need to monitor the flow of market funds has become necessary as this will enable transparency in the market and also give the regulator the ability to identify issues that will progress the sector,” she added.
Mrs Obaji said such move will introduce competition on the demand side and improve efficiency while helping to stimulate investment in the sectors as generators can sign long term contracts.
On the planned N701 billion meant to ease generation liquidity issues, APGC said the GenCos were not consulted by the federal government but however said they await the disbursement modalities from NBET.