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DisCos decry botched N100bn power subsidy

By on April 26, 2017

The 11 electricity Distribution Companies (DisCos) have decried the failure of Federal Government to provide a N100 billion subsidy it promised three years ago, after private investors took over about 18 power sector utilities on November 1, 2013.

The DisCos in a statement by its umbrella body, Association of Nigerian Electricity Distributors (ANED) yesterday also faulted the poor funding for the transmission section of the sector, which they said has resulted in the huge load rejection cases.

The statement issued by ANED’s Director of Advocacy and Research, Barrister Sunday Oduntan said government which holds 40 per cent equity in the utilities stated many interventions in the Performance Agreement of DisCos with the Bureau of Public Enterprises (BPE).

“To date, the government has not met the privatization transaction foundational requirements of providing N100 billion in subsidies; payment of MDA electricity obligations; ensuring that the DisCos have debt free financial books; and implementing a cost reflective tariff,” it said.

On transmission constraints, ANED doubted if the N50 billion appropriated for TCN in the 2016 budget was released by half adding that, “This funding level is even more pitiful when, especially, measured against TCN’s estimate of $7.5 billion for its five-year expansion plan that is expected to take us to 10,000 megawatt (mw), from our current 4,500mw.”

The Daily Trust however reports that TCN’s former Managing Director, Engr. Atiku Tambuwal Abubakar said in February 2017 that the 2016 allocation was released by over 90 per cent, adding that many networks and substations were strengthened for efficient service delivery. “Should the DisCos have to suffer financial losses due to the limitations associated with TCN’s wheeling constraints?,’’ they queried in the statement.

They decried the continued dearth of TCN funding, saying it impedes the DisCos’ ability to distribute power and has led to crashes in power turbines of Generation Companies (GenCos) due TCN consistent requests for de-loading.


[Daily Trust]