Electricity GenCos and DisCos created in 2013 have not improved supply
By Jeph Ajobaju, Chief Copy Editor
Electricity generating companies (GenCos) and distribution companies (DisCos) bank debt jumped 12.83 per cent to N861.14 billion in 2021, but it is just a fraction of N5.83 trillion owed banks by oil and power sectors combined.
The figures are gleaned from both Central Bank of Nigeria (CBN) and National Bureau of Statistics (NBS) data.
Privatisation of DisCos and Gencos done through the Bureau of Public Enterprises (BPE) in November 2013 fetched the treasury $3.2 billion, with Gencos yielding $1.5 billion and Discos $1.7 billion.
Abuja privatised the six successor GenCos and 11 DisCos unbundled from the defunct Power Holding Company of Nigeria (PHCN).
The acquisition by core investors was financed mostly by loans, a significant portion of them provided by local banks. The core investors were looking to restructure the loans in 2020.
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Debt owed banks by other power stakeholders
CBN figures show that
- Power generation firms and independent power producers increased their total debt to N522.2 billion in 2021 from N443.37 billion in 2020.
- Transmission and distribution firms owed banks N338.94 billion in 2021, up from N319.85 billion in 2020, according to reporting by The PUNCH.
The crisis rocking the power sector expands yearly despite efforts by both the government and and the private sector to tackle it.
From power generation to transmission down to distribution, there are diverse problems, as well as in other arms of the industry, such as regulation.
Stakeholders express doubt about the viability of the privatisation of GenCos and DisCos done over eight years ago that has not improved power supply.
This is buttressed by the recent takeover or re-acquisition of some DisCos by a bank and by the Asset Management Corporation of Nigeria (AMCON) and another investor.
“The situation is more complex than the ordinary person sees. The entire experiment may not be yielding the desired results; that is the frank truth,” said Chris Akamnonu, who was Managing Director in three Discos in the South East and South West for about 13 years.
