Looming Electricity Crisis: Power ministry speaks on N4 trillion debt owned GenCos

"We are not unaware of this debt arising from the federal government’s commitment on subsidy. "

The federal government says plans were in place to offset the N4 trillion debt owed to the Power Generation Companies (GenCos) for electricity generated.

The Special Adviser, Strategic Communications and Media Relations to the Minister of Power, Bola Tunji, made this known in an interview with the News Agency of Nigeria (NAN) in Abuja on Tuesday.

Mr Tunji was reacting to a statement by GenCos appealing to the federal government and stakeholders in the power sector to settle the more than N4 trillion debts owed them for electricity generated.

According to him, the minister of power is concerned and the issue is being discussed with the ministry of finance on how the debt must be paid.

”We expect the ministry of finance to take action on this soon.

“We are not unaware of this debt arising from the federal government’s commitment on subsidy. Part of the debt is legacy debts, which were on the ground before the minister of power assumed office.

“The minister has repeatedly harped on this, knowing the implication of such debts to the operations of the various power sector stakeholders, especially the GenCos,” he said.

The News Agency of Nigeria (NAN) reports that the Association of Power Generation Companies (APGC), in a statement, said that GenCos were currently owed N2 trillion for power supplied in 2024 and N1.9 trillion in legacy debt.

The GenCos also noted that against the backdrop of the many challenges facing the power sector in Nigeria, the crises from cash liquidity are on the top burner and has reduced their ability to continue to perform their obligations.

This, according to a statement issued by Sani Bello, chairman Board of Trustees of APGC, is threatening to completely undermine the electricity value chain.

”Besides being owed huge debts, the GenCos were also operating under very harsh monetary and fiscal conditions.

”It is no more news that the GenCos have continued to bear the brunt of the liquidity crisis in the Nigerian Electricity Supply Industry (NESI),” he said.

(NAN)