Electricity Distributors Want Senate To Reconsider Stopping Bond For Electricity Firms

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Mr Sunday Oduntan

The Association of Nigerian Electricity Distributors (ANED) has appealed to the National Assembly to reconsider stoppage of bond for electricity companies to avoid the collapse of the power sector.
The Executive Director, Research and Advocacy of ANED, Mr Sunday Oduntan, stated this in a telephone interview with the News Agency of Nigeria (NAN).
Oduntan said that the power sector had a huge liquidity gap, which was being bridged by government’s intervention in form of bond, adding that electricity consumers no longer show the willingness to pay bills.
In his words, “Government’s ministries, departments and agencies are owing to the sector over N100 billion electricity bills.
The executive director said that bond was a form of promissory notes given to power sector in form of loan to cover some shortfalls in the industry.
Oduntan told NAN that electricity Distribution Companies (DISCOs) had no chances of obtaining bank loans because banks believed that it would be difficult to recover loans given to them.
He said, “We are appealing to the senate to revisit its stand on stoppage of bond for electricity companies.
He further said, “At present, electricity companies need the bond to balance the liquidity gap in the sector. The government is assisting the sector through this medium.
“With stoppage of this intervention, DISCOs will find it difficult to buy new transformers and meters, while Generation Companies (GENCOs) will not have resources to service their plants.
“The stoppage of this bond with will contribute to the collapse of the power sector,” he added.
The News Agency of Nigeria (NAN) reports that on Oct. 12, the senate passed a resolution stopping the Ministry of Power, Works and Housing from using the Nigeria Bulk Electricity Trading Company (NBET) to give electricity companies an N309 billion bond.
  • Guardian

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