Nigeria Got Nothing In Second Quarter 2021 For Giving Togo, Benin Republic, Niger Power — NERC

The Nigerian Electricity Regulatory Commission (NERC) has said that three neighbouring countries did not make any payment for the second quarter of 2021.

In its recently released Second Quarter Report 2021, the NERC revealed that the countries (Togo, Benin Republic, and Niger) and some other special customers were issued a total bill of N770m by the Nigerian Bulk Electricity Trading company and the Market Operator of the Transmission Company of Nigeria.

The report however stated that no payment was made, adding that it is hoped the outstanding will still be paid when things begin to look up for those economies, as the pandemic played a great role in the non-remittance experienced.

“During the quarter under review, NBET and MO issued a total ₦0.77billion in respect of energy sold by NBET and services rendered by MO to the special (Ajaokuta Steel Co. Ltd and other bilateral customers) and international customers (Societe Nigerienne d’electricite – NIGELEC, Societe Beninoise d’Energie Electrique – SBEE and Compagnie Energie Electrique du Togo–CEET).

“No payment was made by these customers during the quarter under review. It is hoped that as the economy of these customers improves post-covid 19 lockdown they will resume the settlement of their bills in full,” the report read in parts.

The Commission further stated that it has through the applicable orders set a minimum remittance threshold (MRTs) for each Disco having adjusted for their tariff shortfall.

Adding that the inadequacies recorded within the period show that DisCos need to improve on their performance as none of them met the minimum remittance threshold.

“Whereas the Discos were expected to remit ₦130.66billion (62.99%) to NBET in line with the minimum remittance threshold order, they remitted only ₦ 91.31billion (44.02%) out of ₦207.43billion invoice from NBET.

“Therefore, DisCos’ remittance level, regardless of the prevailing tariff shortfall, was still below the expected MRT.

“Necessary mechanism must be used to nudge the Disco into compliance with the MRT order to avoid a relapse to days of zero remittance from some Discos,” the NERC stated.

The commission further disclosed that during the second quarter of 2021, a total invoice of ₦259.70billion was issued to the eleven (11) DisCos for energy received from the Nigerian Bulk Electricity Trading Plc (“NBET”) and for service charge by MO, out of which a sum of ₦130.11billion was settled, representing remittance performance of 50.11%.

This according to the NERC represents a 1.78 percentage point decrease from the final settlement rate recorded in the first quarter of 2021.

Apart from Eko Disco, none of the other DisCos met their expected minimum remittance thresholds (“MRTs”) to NBET in the quarter under review.

Overall, the total Disco remittance to NBET was 76% of the expected total for the quarter.

As part of its inferences regarding the development, the NERC noted that one of the contributory factors to high ATC&C losses, and hence poor liquidity, is the non-settlement of energy bills by MDAs across the three tiers of government (i.e., Federal, State, and Local Government).

In the commission’s opinion, an urgent resolution of the MDA debt challenge will improve the Disco liquidity and capacity to settle market invoices.