MDAs Owe Six Discos N31bn

Logo of Nigerian Electricity Regulatory Commission

Chineme Okafor in Abuja

The various Ministries, Departments and Agencies (MDAs) of both the federal and state governments in the country are from a recent electricity debt report profile of six electricity distribution companies (Discos) owing over N31 billion in electricity bills already consumed by them since November 2013.

The total debt profile of the six Discos, which was obtained from the Discos by THISDAY in Abuja, showed that the Ministry of Defence, military and the paramilitary formations in the affected distribution networks alone owe the Discos N15.5 billion.

The affected Discos in the aggregated record, in the paper sighted, are Abuja Electricity Distribution Company (AEDC), Kaduna Electric, Kano Electricity Distribution Company (KEDC) and Eko Electricity Distribution Company (EKEDC) as well as Benin Electricity Distribution Company (BEDC) and Ibadan Electricity Distribution Company (IBEDC).

The record of debts owed to the other Discos; Port Harcourt, Ikeja, Enugu, Yola and Jos Discos, by government agencies was not seen.

However, the breakdown showed that Abuja Disco is owed N7.1 billion with the Ministry of Defence owing a larger chunk to the tune of N3.6 billion.
The military was again sighted as the highest debtor in the books of Kaduna Electric with over N5.7 billion, while the police, other paramilitary outfits and state MDAs owe over N980 million. Kaduna’s entire debt from public institutions stands at N6.7 billion.

For Ibadan Disco, N5.2 billion is owed to it by the federal and state MDAs, while the military owes N3.9 billion to it; others owe it the balance of N1.2 billion.

Kano Disco is however owed over N860 million with the state and other MDAs owing N560 million and military formations owing N260 million.

Eko Disco in Lagos is owed N2.3 billion with the police, federal and Lagos government owing over N400 million to it. The military formations owe N1.9 billion to the Discos.

It will be recalled that Abuja Disco had in late 2014 disconnected the Federal Secretariat in Abuja from its services, following huge debts owed by the MDAs housed in the secretariat.

Also, the Director of Advocacy and Research for the Association of National Electricity Distributors (ANED), an interest group of the Discos, Sunday Oduntan had recently said that the debts owed to the Discos by government and public institutions remains a huge burden that impacts negatively on their operations.

Meanwhile, the Nigerian Electricity Regulatory Commission (NERC) has issued an order imposing financial penalties on any Disco that rejects electricity allotted it by the System Operators (SO).

NERC said that the order titled: “Order on the Imbalance Application Mechanism during the Transitional Electricity Market,” was issued on account of high incidence of indiscipline by Discos who reject load allocations by the SO.

It explained in a press statement that was signed by its Head of Public Affairs, Usman Arabi that the Nigerian Electricity Supply Industry (NESI) operates on the basis of a sharing formula approved by it, which the SO uses to allocate generated electricity to the Discos.

NERC however noted that many of the Discos have been found to lately reject their electricity allocation.

“Rejection of load allocation besides causing imbalance in the system is preventing electricity consumers from realising the maximum benefit of the recent increase in the electricity generation. Electricity generation in the country about two weeks ago notched 4,600 megawatts threshold,” it said.

To curb such act of indiscipline, NERC in the order said: “Where a distribution company has a constraint on its network that will make it unable to receive load, the Disco shall declare such constraint to the SO a day ahead. Where a Discos fails to give the required notice, it will be penalised.”

It added: “Besides, every Disco is obligated to receive load as directed by the SO, even beyond its statutorily allocated load at any time. This additional load will not attract penalty.

In allocating additional load to distribution companies, the SO shall take cognisance of historical data on distribution company’s ability to take power beyond their location.”

NERC however noted that the Transmission Company of Nigeria (TCN) would be sanctioned if rejection of load allocation was caused by constraint in the transmission network.

Giving an insight into the background of the order, which became effective over the weekend, NERC’s Chairman, Dr. Sam Amadi, said it was aimed at eliminating imbalance and make Nigerians have maximum impact of the improvement in the generating capacity and to also incentivise operators to invest in their network to take more power.

Amadi said that most of the Discos and TCN have been using inadequacy of electricity supply as an excuse not to strengthen their networks, adding: “The new threshold of power generation has exposed this weakness in their networks and we have that responsibility to force them to invest in their networks.”