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DisCos’ debts to NBET, market operator hit N103 billion


Distribution companies (Discos)

The Electricity Distribution Companies (Discos) in Nigeria are indebted to the Nigerian Bulk Electricity Trader (NBET), and Market Operator (MO) to the tune of N103billion, according to the Nigerian Electricity Regulatory Commission recent (NERC) report released this week.

DisCos were issued an invoice totalling N147billion for energy received from NBET and for the service charge by the Market Operator in the third quarter (Q3) 2017, but only N44billion was settled, creating a shortfall ofN103billion, NERC revealed.

According to NERC, liquidity challenge in the industry continued to manifest within the quarter as evidenced in the DisCos’ remittances to the NBET, the manager and administrator of the electricity pool in the Nigerian electricity supply industry, and the Market Operator, relative to invoice.


The electricity regulator gave a comparative analysis of upstream remittance by DisCos relative to the invoices issued by NBET in respect of energy delivered, as measured at the interface point and the MO in respect of administrative services.

It said: “During the period under review, DisCos were issued an invoice totalling a sum of N147billion for energy received from NBET and for the service charge by the Market Operator, but only N44billion was settled, creating a shortfall ofN103billion.”

To address the liquidity challenge in the electricity industry, with particular emphasis on the poor remittance by DisCos, the Commission said it is currently working on a framework to ensure a fair and equitable distribution of market revenues.

The framework, it noted, is aimed at ensuring transparency and fairness in the utilisation of market funds.

The Commission said it will continue to monitor the operational and commercial performances of the industry in line with the mandate derived from the Electric Power Sector Reform (EPSR) Act 2005.

According to NERC, during Q3 2017, the total electric energy generated stood at 7,568,489MWh.


This was 3.2 per cent less than the generation in the second quarter.

For the quarter under review, the industry recorded the peak daily generation of 4,589.70MW on September 6, 2017.

Despite the increase in the peak generation in Q3, the utilisation of the total available generation capacity was however still constrained by a combination of factors including inadequate gas supply, transmission bottlenecks and limited distribution networks, it explained.

NERC said: “The resolution of these technical and operational constraints of the industry remains a top priority of the Commission.

While the government has commenced the implementation of a payment assurance facility for power generators as a means of sustaining generation levels, the Commission has accordingly identified in its 2017-2020 Strategic Plan the actionable items towards addressing constraints in transmission and distribution networks.

“The planned strategy includes a thorough technical assessment of DisCos’ utilisation of its capital expenditure allowances for relevance and cost efficiency and a tariff reset in order to stimulate investments in network infrastructure.”

When The Guardian contacted the Managing Director, NBET, Marilyn Amobi, she declined to comment on the report.

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