The liquidity situation in Nigeria’s power sector has worsened, as the indebtedness of the distribution companies, DisCos, to Nigerian Bulk Electricity Trading, NBET, Plc., has increased to N396.86 billion, indicating an increase of seven per cent, compared to N368.83 billion recorded in the corresponding period of 2019. This debt profile accrued by the inability of the 11 power distribution companies in the country to remit a total of N396.86 billion to the NBET for the electricity sold to them from January to September 2020.
The government-owned NBET buys electricity in bulk from generation companies, through power purchase agreements, and sells through vesting contracts to the DisCos, which then supply it to the consumers. The NBET data compiled by Vanguard Energy show that the bulk electricity trader sent an invoice value of N538.25 billion in the 9-month, but only paid N121.3 billion, which left a balance of unremitted N416.9 billion. This is, however, against N146.8 billion recorded during the corresponding period, which had an invoice value of N516.44 billion in 2019. Accordingly, in the first quarter of 2020, total invoice of N156.7 billion was issued to the DisCos, the sum of N54.2 billion of the total invoice was settled, representing 32.53 per cent to N102.5 billion unremittance performance.
This is against the corresponding quarter in 2019, which had N161.26 billion invoice issued, while N33.6 billion was paid, leaving DISCOs with an unpaid NBET Invoice that rose by 5 per cent to N123 billion. In the second quarter of 2020, as against the corresponding year of 2019, average invoice was N192.4 billion, as against N180.08 billion, while N36.42 billion, as against N55.10 billion invoices was paid, thereby accruing unpaid invoice of N156.01 billion, as against N124.98 billion recorded in 2019.
Also, in the third quarter of 2020, as against the corresponding year of 2019, average invoice issued rose to N189.05 billion, as against N179.66 billion, while N50.67 billion, as against N58.81 billion invoice was paid, thereby accruing unpaid invoice of N138.38 billion, as against N120.85 billion recorded in 2019. But in the fourth quarter of 2019, average invoice issued rose to N193.66 billion, while N74.20 billion invoices was paid, thereby accruing unpaid invoice of N119.46 billion.
