Discos, Gencos, others get N55bn intervention fund from CBN

The Central Bankof Nigeria (CBN) has disbursed a total N55, 456, 161, 481 to the power sector in a bid to address the nation’s power problems.

The money was released from the CBN’s Nigerian Electricity Market Stabilisation Facility (NEMSF).

All distribution companies, Discos, were given N8,670,234,863.76, generating companies, Gencos, got N35,834,536,939, gas suppliers got N10,491,710,788.66, while all service providers in the power value chain were given a total of N459,678,889.55.

According to reports, the money is the fourth batch from the N213 billion stabilisation fund designed by the CBN as part of development finance intervention in the economy.

CBN Governor, Godwin Emefiele, while speaking at the signing of the agreement for the disbursement of the fund and presentation of cheques to the power sector investors in Lagos, said the fourth batch disbursement is a major milestone in the effort of the bank in collaboration with the federal government to achieve a contract based
electricity market.

According to him, this would activate Power Purchase Agreements (PPA) by the Nigerian Bulk Electricity Traders (NBET) and signal activation of industry contracts for power generation.

He said: “By the end of today, total disbursements to the Discos will be N49.73 billion (91.7%); Gencos N54.29 billion (62.5%), gas companies N15.73 billion (36.9%) and service providers N0.46 billion (1.7%). With today’s event, the total disbursements under the initiative will be N120.2 billion, representing (57%) of the total amount earmarked.”

Read also: Oil Marketers to FG: We can’t access forex

Emefiele further explained that the CBN-NEMSF was initiated as part of the commitment it reached with stakeholders to address debts owed by generating companies to gas suppliers.

The batch of the fund was released in January 2015, with the companies committing to using the funds to upgrade/refurbish their equipment and acquire new ones so as to improve service delivery. It has a 10 percent interest rate.

Minister of Power, Works and Housing, Babatunde Fashola, while speaking at the event, said there was need for all stakeholders in the power sector to continue to work as a team to end perennial supply in the country.

“One of the problems we are having is gas. Some people have developed a mind set to continue to vandalise gas pipelines. Let me say it very clearly that it doesn’t help this country, it does not help their communities and it doesn’t help their people”‘, he said.

RipplesNigeria …without borders, without fears

Join the conversation

Opinions

Support Ripples Nigeria, hold up solutions journalism

Balanced, fearless journalism driven by data comes at huge financial costs.

As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.

If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.

Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.

Donate Now