FG to Review MDA’s Huge Debts to Distribution Companies

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The federal government said that it will review the huge debts owed the 11 electricity distribution companies (Discos) by its ministries, departments and agencies (MDAs) with a view to paying them off once their statuses are determined.
Mr Babatunde Fashola, Minister of Power, Works and Housing, stated this when he hosted the new Managing Director of Abuja Electricity Distribution Company (AEDC), Mr Ernest Mupwaya in his office in Abuja.
He said, “We need to verify some of the debts and rectify who owes what and who is owed what.”
Fashola urged AEDC to provide the government with useful information to speed up the reconciliation of its debt.
He said in June, the Debt Management Office (DMO) had initiated a financial plan to pay off the huge debt.
The minister said that with the DMO’s plan which was in response to a letter he wrote to it requesting for alternative means of settling the debt, it will be paid off  before the year runs out.
The Discos through their network – the Association of Nigerian Electricity Distributors (ANED), put the MDAs debt at about N78.7 billion, with the Nigerian Army as the single largest debtor to the Discos, having consumed without paying N38.75 billion worth of electricity over time.

Also on the list is the Nigerian Airforce with N3.09 billion, Navy – 3.3 billion, Police – N4.66 billion, Customs – 528.78 million, Prisons – N895.6 million and Immigration – N47.8 million.

A further breakdown of the debt indicated that federal ministries and parastatals across Nigeria owed the distribution companies N9.98 billion in unpaid electricity bills.
State governments also owed the Discos N16.21 billion while local government owed N1.16 billion.
The record equally showed that of the 11 Discos, Abuja is owed N18.6 billion, Benin – N5.9 billion, Eko – N8.6 billion, Enugu – N7.2 billion, Ibadan – N6.8 billion and Ikeja – N5.9 billion.

Others such as Jos is owed N6.5 billion, while Kaduna, Kano, Port Harcourt and Yola Discos are owed N8.2 billion, N1.2 billion, N6.88 billion and N2.46 billion respectively.
The Executive Director, Research and Advocacy of ANED, Mr Sunday Oduntan stated then that the debt was impacting on the Discos’ operations, with their liquidity levels becoming tight.
Meanwhile, Mupwaya disclosed to Fashola that Abuja Disco has been unable to meet the request for a Letter of Credit (LC) to the Nigerian Bulk Electricity Trading Plc (NBET) and equally participate in the Central Bank of Nigeria (CBN) market support fund due to the huge debt owed it by the MDAs.

ThisDayLive

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