Nigeria is facing a significant challenge with unpaid debts from its neighboring countries for electricity supplied in the first quarter of 2024. The Nigerian Electricity Regulatory Commission (NERC) has disclosed that Togo, Benin, and Niger collectively owe $14.19 million for electricity they received, but none of them have made any payments so far.
This debt includes amounts owed by several power companies in these countries. In Benin, Para-SBEE and Transcorp-SBEE are responsible for $3.15 million and $4.46 million, respectively. Meanwhile, Togo’s Mainstream-NIGELEC and Odukpani-CEET owe $1.21 million and $5.36 million, respectively. Despite the invoices issued to these companies, the payments have not been made, putting pressure on Nigeria’s power sector.
Although the debts for the first quarter of 2024 remain unpaid, some payments have been made for previous quarters. The NERC report highlights that two international customers paid $5.19 million towards outstanding bills from earlier periods. Similarly, some domestic customers within Nigeria settled their debts, contributing N505.71 million in payments.
On the local front, Nigerian electricity Distribution Companies (DisCos) have shown improvement in their payment performance. In the first quarter of 2024, the DisCos were billed a total of N114.12 billion for various services, including generation and transmission costs. They managed to remit N110.62 billion, achieving a remittance rate of 96.93%. This is a marked improvement from the 69.88% recorded in the previous quarter.
However, the NERC report also highlighted a decline in Nigeria’s overall electricity generation capacity during the first quarter of 2024. The average available generation capacity across all power plants dropped to 4,249.10MW, a decrease of 13.68% compared to the last quarter of 2023. The drop in capacity was attributed to reduced outputs from 17 of the 27 grid-connected power plants in the country.
This combination of unpaid international debts and reduced electricity generation poses challenges for Nigeria’s power sector. The government will need to address these issues to ensure the stability and sustainability of electricity supply both within the country and to its neighbors.
As Nigeria continues to provide electricity to its neighboring countries, the need for timely payments and improved generation capacity remains critical to maintaining the country’s power infrastructure.
