The Federal Government has not disbursed a balance of N90.4 billion intervention fund for the power sector, the Association of Nigerian Electricity Distribution Companies has said.
The country’s government, through the Central Bank of Nigeria (CBN) and the Bankers Committee in 2014, announced a N213 billion Nigerian Electricity Market Stabilisation Facility (NEMSF) for the power sector.
The aim was to offset the legacy gas debts, address revenue shortfall in the sector, and improve electricity supply to Nigerians.
With over N120 billion already disbursed in tranches to sector operators by the CBN, there were about N90.4 billion to be disbursed according the ANEDC.
On why the sector had yet to record a significant improvement despite government’s interventions, the Executive Director, Research and Advocacy of the ANEDC Sunday Oduntan hinted that it was due to drop in Federal Government support.
Oduntan noted that with the current fall in the electricity market and the envisaged further decline, the balance of N90.4billion would not address the shortfalls.
“When Government say fund has been made available to operators, it is true. But what people need to know is which fund, how much, what is the funding gap.
“We are not saying government is not making an effort. For example the major intervention fund that we had was a loan given by the CBN administered by the Federal Government.
“ Until now, they are still disbursing and not everybody has received it.
“As I am talking to you, the balance that are yet to be disbursed is N90.4 billion that is the balance of NEMSF.
“It is supposed to be NEMSF 1 and NEMSF 2, but we are still on NEMS 1, that is yet to be fully disbursed.”
He said that the facility from the CBN and the huge debts own DISCOs by government agencies constituted part of the deficit in the balance sheet of the DISCOs.
He predicts further decline
According to him, the electricity market will experience further shortfalls.
He then said that efforts should be made to save the sector through the injection of more funds.
“By the end of December, the total short fall will be N809.8 billion that is the industry short fall for the entire value chain.
“When you have these shortfalls, monies that ought to be paid and remained in the sector are not there.
He said the shortfall cannot be shifted to the electricity consumers in the form of increased tariff, adding that consumers could not afford to pay for a higher tariff with N18,000 minimum wage.
“ We will be deceiving ourselves if we the DISCOs think we can do something about it. The only thing that we can do is that government must look for a way of helping the sector further.