Discos groan under N49.3b debt by MDAs, states, military

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A CHOKING debt of about N49,305,181,196.66 owed the 11 electricity distribution companies (Discos) in the country is one of the impediments against their efficient operations.

According to the Nigerian Electricity Regulatory Commission (NERC), the debt is owed by federal and state governments’ departments and agencies, including the military and police.

The Guardian learnt that of the figure N27,635,968,440.69 was accumulated since the handover to private sector firms in November 2013.

The owners of Abuja Electricity Distribution Company alone are owed N7 billion.

Officials say such a huge debt overhang could frustrate effort by Discos to provide more meters and upgrade their networks for efficient service delivery.

It was learnt that though former President Goodluck Jonathan through the Secretary to the Government of the Federation had authorised the then Accountant-General of the Federation to deduct at source their debts from defaulting MDAs, such deductions were yet to be implemented.

Meanwhile, NERC has written to the National Assembly requesting legislative support to compel Ministries, Departments and Agencies (MDAs) to prove evidence of debt payment to Discos during budget defence and oversight activities.

In order to improve the collection of revenue by Discos, NERC, it was learnt, plans to issue regulations that empower them to cut off supply of electricity to customers who are unwilling to pay their bills.

NERC Chairman, Dr. Sam Amadi, confirmed to The Guardian that his commission wrote the National Assembly requesting the support of the legislative chambers to recover the debts as a deliberate way of boosting the liquidity of the sector.

On the efforts by the presidency to intervene in the matter, he noted: ‘‘We have escalated this issue to the office of the vice president and interventions are being proposed to help with the financial viability of the Discos.”

On the letter to NASS: ‘‘Yes, we wrote. We think that paying off this huge debt and ensuring prompt payment for electricity consumed by MDAs would immediately assist to resolve the legacy problems.”

He admitted that ‘‘while it was not an easy decision to cut off debtors, it has also become imperative that liquidity of Discos be improved considerably to ensure reliability and stability of electricity supply. We will also request the committees on Power of the National Assembly to lead efforts to ensure that communities are properly billed. We are going to penalise failure to individually meter customers in estates and rural communities after a reasonable period of time.”

In an earlier interview, Director of Advocacy and Research for the Association of National Electricity Distributors (ANED) said the debts owed the Discos by the government and public institutions were a huge burden on the infant industry.

“What President Muhammadu Buhari promised voters is that there will be a change. He needs to talk to his people from the State House to the State Governments to pay their bills. There are provisions for utilities in the budget of agencies, since they are not paying the bills, what then happens to the money?” Oduntan asked.

Meanwhile, heads of various agencies in the electricity sector of the Federal Ministry of Power, Works and Housing are ready to brief the Minister, Babatunde Raji Fashola of the state of affairs with their mandates.

The briefings which are to commence anytime following Fashola’s return from his trip with Buhari to Tehran are meant to compare notes on the state of affairs in the various organs operating in the sector.

Source: TheGuardian