Discos, Gen. Biz, Government, Ministry of Power, NBET, NDPHC, NERC

Q1 2020 Power Supply Performance: More Power from GenCos, less Revenue Returns from DisCos

Posted: August 1, 2020 at 5:35 pm   /   by   /   comments (0)

The nation is experiencing inverse performances in the power supply sector according to the data published by the Nigerian Bulk Electricity Trader, NBET, on its website. While the power generating companies, GenCos, are producing more power and TCN is wheeling all these to the distribution companies, DisCos, the DisCos are returning less and less into the system.

According to NBET, the total power value invoice from the generating companies for January, February, March and April were N51.8b, N51.4b, N52.8b and N70b respectively. Notice for instance the huge increase in power delivered in April compared with March.

Inversely, funds disbursed to the GenCos for the corresponding periods show a decline. There were N15.6b ie 30% in January; N13b ie 25.4% in February; N5.8b ie 11% in March and N10.1b ie 14.5% in April.

The above payments to the GenCos were based on the poor returns from the power distribution companies, DisCos. The DisCos have not been able to return to NBET the agreed performance rate approved for them by the industry regulator, NERC, which is an average of 36%.

In January, the 11 DisCos got a total power value invoice of N52.1b and they made a total/combined return of N14.9b ie 29% to NBET. In February the total invoice was N52b and their return was N13b which is 25%.

For March, the invoice was N52.6b and their return was only N6b which is 12% performance (no remittance from Kano DisCo). While in April, the invoice rose to N68b and the DisCos returned N9.8b- a 14% performance (though without remittances from Kano and Kaduna DisCos according to the NBET report).

Several power sector experts believe that the Covid 19 lockdown must have contributed to worsening the situation for the DisCos, as industrial customers were off production, while commercial and residential customers were restricted to their homes.

However, some of the experts added that most of the DisCos except probably Ikeja DisCo have not been able to deploy sustainable strategies to operate during a pandemic lockdown that the nation experienced. They advised going forward that managements of the DisCos should conceive and deploy more IT and remote customers engagement applications that would be activated during future general movement restricted eco-system in order to sustain operations especially revenue.

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