The government-backed N50 billion take-off loans to the private firms that emerged as distribution companies (Discos) and generating companies (Gencos) for the power sector, is on its way to being classified as bad debts, according to a finding.
In 2014, a collection of private firms were cleared by BPE, which supervised sale of the former Power Holding Company of Nigeria (PHCN) to have a soft loan to be able to survive initial challenges they faced at take-off.
Also recently, the Minister of Power, Works and Housing, Mr. Babatunde Fashola, in a communique after a meeting held by the operators in the sector earlier in the year, had revealed that the Central Bank of Nigeria (CBN) will resume disbursement of funds in its N213 billion worth Nigerian Electricity Market Stabilisation Facility (NEMSF) to operators.
The beneficiaries were Discos, Gencos and others- in the power sector.
But as at today, none of the beneficiary companies is in a position to say when to begin refunding the loan, even as they are still expecting more financial supports.
The situation has also affected conclusion of negotiations for another loan, a €50million (N111.5 billion) international facility between Nigeria and France in support of the sector.
This was supposed to have been finalised last May, but still dragging.
Officials, who were said to have been through with the documentations on the foreign-backed loan complained of a foot dragging approach by France on the basis of not being properly furnished of the local loan to the sector.
But spokespersons of both the Gencos and Dicos have not failed to declare openly that they met more problems on the ground than what BPE made them believe was the case before taking over the various split units of PHCN.
They said the solution to meeting expectations on the loan re-payment and improving on power generation is to allow a 45 per cent increase in electricity tariff across the country to stand, though the court had said no to it.
The Acting Chief Executive Officer, NERC, Dr. Tony Akah, said: “The commission respects this decision of the court.”
Also, the Association of National Electricity Distributors’ executive director Mr. Sunday Oduntan alleged that government agencies and parastatals were owing them unsettled bills worth more than N60 billion, adding that without settling this no improvement can be made.
By Emma Eke…
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