Tony Elumelu Explains Why Nigeria Lacks Proper Electricity, Gives Solutions
- The chairman of Transnational Corporation Plc wants FG to pay up the debt it owes power-generating companies
- The billionaire investor said that the federal government is owing Transcorp Power N250 billion
- He added that the debt negatively impacts power generation businesses' capacity to pay their gas suppliers
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Legit.ng journalist Zainab Iwayemi has over three years of experience covering the Economy, Technology, and Capital Market.
Tony Elumelu, chairman of Transnational Corporation Plc, urged the federal government to expedite the payment of the nation's over N2 trillion debt to electricity generation firms (Gencos).
Source: Getty Images
Elumelu said this during the corporation's 18th annual general meeting (AGM) in Abuja.
The billionaire disclosed that TransAfam Power, a generating firm owned by Transcorp Power, is owed N250 billion.
According to Elumelu, the debts persistently negatively affect the generation companies' ability to pay their gas suppliers, which in turn affects the quantity and dependability of the latter's gas supply as well as investment in generation.
He declared that the massive distortion in the sector's liquidity flow persisted, as evidenced by the approximately N2 trillion in debt Nigerian Bulk Electricity Trading Plc (NBET) owes Gencos.
According to Elumelu, the power industry was built on a cycle that guarantees payment security and liquidity flow, supporting electricity's steady flow from power-producing businesses to final consumers.
Elumelu commends the current administration
Elumelu praised the president's recent pledge to settle the outstanding debt with the GenCos, according to Arise TV report.
Nonetheless, he calls for the swift execution of the measures required to turn the declarations into reality.
The chairman of Transcorp further assuaged shareholders' concerns about the possibility of significant asset dilution following the banking sector's consolidation.
Much to the delight of the stockholders, he also announced that Transcorp Power's acquisition loan, denominated in dollars, had been fully settled.
Elumelu added that as of this year, the corporation would raise and maintain its total available generation capacity to 908 megawatts, up from 710 megawatts in 2023.
Furthermore, he said:
“We plan to take advantage of the bilateral power sale opportunities arising from the enactment of the 2023 Electricity Act by entering into agreements with strategic electricity distribution companies and eligible customers."
More problems
According to Elumelu, energy theft continues to be a significant hindrance and source of frustration for distribution companies (DisCos) and the electricity industry.
DisCos not only lose money due to stolen electricity, but they also sustain significant losses and damages due to their infrastructure being vandalised during energy or infrastructure theft.
NERC announces new rate for electricity tariff
Legit.ng reported that the Nigerian Electricity Regulatory Commission (NERC) has announced that the currency rate used to determine Band A consumers' current electricity cost has been lowered by 16.03%.
NERC cited this in its recently released Multi-Year Tariff Order (MYTO) for May to December 2024.
The electricity regulator consequently said it slashed the rate from N1,463.3/$ to N1,277.8/$ due to the appreciation of the naira against the dollar in the past month.
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Source: Legit.ng
