Nigeria Faces N9.41bn Power Debt as Benin, Niger, Togo Struggle With Payments
- Nigeria's West African neighbours owe significant debts due to unpaid electricity bills for power supplied to them
- Under an international agreement, Nigeria provides electricity to countries like Benin, Niger, and Togo
- However, these outstanding payments are negatively impacting the efficiency and stability of Nigeria's power sector
Legit.ng journalist Victor Enengedi has over a decade's experience covering Energy, MSMEs, Technology and the stock market.
The Nigerian Electricity Regulatory Commission (NERC) has reported that international customers owe $5.79 million for electricity supplied in the second quarter of 2024.
The agency's latest quarterly report details this debt, equivalent to N9.41 billion at the official exchange rate of N1626.32/$ as of October 10.
Source: UGC
Nigeria exports electricity to various countries, including Niger, Togo, and the Republic of Benin and based on strategic agreements with neighbouring countries.
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Earlier NERC data showed that these international electricity customers owed the Nigerian government over $51 million in power debt in the first quarter of 2024.
Nigeria's neighbours struggle with N9.41bn bill
According to the recent report, market operators (MO) sent an invoice of $15.60 million to four companies across three countries. Of this amount, only $9.81 million has been paid.
The companies involved include Paras-SBEE and Transcorp-SBEE from Benin Republic, Mainstream-NIGELEC from Niger, and Odukpani-CEET from Togo.
Nigeria, under an international agreement, supplies electricity to neighbouring countries such as Benin, Niger, and Togo.
Additionally, the commission highlighted that domestic bilateral customers had not paid N695.4 million out of a total of N1.99 billion during the same period.
The report stated:
“In 2024/Q2, the four (4) international bilateral customers serviced by the MO made a cumulative payment of $9.81 million against the $15.60 million invoice issued to them by the MO for services rendered in 2024/Q2.
“Similarly, the domestic bilateral customers made a cumulative payment of N1,295.90 million against the cumulative invoice of N1,991.30 million issued to them by the MO for services rendered in 2024/Q2.”
The Nigerian Electricity Regulatory Commission (NERC) reported that some bilateral customers, both domestic and international, made payments in the second quarter of 2024 to settle outstanding Market Operator (MO) invoices from previous periods.
Specifically, domestic bilateral customers paid a total of N1.31 billion towards clearing these old invoices, and Mainstream Energy Solutions has fully settled all its outstanding invoices from earlier quarters.
However, under a special arrangement, Ajaokuta Steel Company Limited and its host community did not make any payments on the N1.39 billion invoice from the Nigerian Bulk Electricity Trading (NBET) or the N0.11 billion invoice from the MO issued during Q2 2024.
The commission warned that the non-payment could lead to a complete disconnection from the electricity grid.
It should be noted that the rising debt had earlier forced the Nigerian government to mandate power-generating companies to reduce electricity supply to neighbouring countries.
Cabal benefitting from poor electricity supply in Nigeria
Meanwhile, Legit.ng earlier reported that Barth Nnaji, a former minister of power, alleged that fuel suppliers and generator sellers are sabotaging efforts to ensure that Nigerians have consistent access to power.
He made the claim while participating in "The South East Political Roundtable" on Flo FM in Umuahia, Abia State.
According to the former minister, the ongoing failure of the national grid remained a significant source of concern for Nigerians.
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Source: Legit.ng
