GenCos get another N12 bn interventions from government

Power Generation Companies (GenCos) have received another round of fund injections from the government to boost their operations and enhance capacity utilisation.

This news was confirmed by the Nigerian Bulk Electricity Trader (NBET), which stated that about N12 billion ($39 million) intervention has been paid to 10 power generation companies in Nigeria.

It would be recalled that the Association of Power Generation Companies (APGC) raised concern about the stoppage in gas supply from the gas companies due to their inability to fulfil their financial obligations.

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NBET made this intervention from the recently obtained N701 billion ($2.3 billion) payment guaranty obtained from the World Bank Group (WBG) through the Federal government. Earlier in the year, the Federal Executive Council (FEC) has approved N701 billion payment assurance fund disbursement to GenCos for power delivered on a monthly basis for the next two-year, beginning from January 2017.

Speaking on the developments, Director of Corporate Communications of NBET, Henrietta Ighomroro stated: "The N701 billion intervention of the federal government is a loan to NBET to, in the short term, enable it to meet its payment obligations to the GenCos for power certified delivered on a monthly basis so they can have enough revenue to pay gas suppliers and run their operational and overhead costs, and it is meant to run for two years, beginning from January.”

She also noted that the 10 Gencos that have received the fund are those that meet the requirements as stipulated by the funds, while others are in the process of doing so. These Gencos are Kainji, Jebba, Shiroro, Geregu, Olorunshogo, Omotosho, Shell Afam, Opai Agip and Omoku.

“The payment for the 10 GenCos was gulping an estimated N12 billion, other GenCos were yet to receive their payment as they are yet to comply with the requisite documentations that will enable their eligibility,” she stated.

On the conditions required to benefits from the Fund, GenCos are expected to have a Power Purchase Agreement (PPA) with NBET. A PPA is a contract term involving the NBET and Gencos on how power is bought from the Gencos and payment is made.

Once a GenCo has provided all the requisite documents confirming that power was delivered to the Transmission Company, the qualify for payment.

Information available shows that there are currently about 22 GenCos having PPAs with NBET.

GenCos get another N12 bn interventions from government

Power Generation Companies (GenCos) have received another round of fund injections from the government to boost their operations and enhance capacity utilisation.

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