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Reps panel drills NBET over power purchase pacts

By Msugh Ityokura, Abuja
27 August 2022   |   4:00 am
The House of Representatives Committee on Finance yesterday drilled the Nigerian Bulk Electricity Trading (NBET) company over power purchase agreements that have failed to stabilise electricity supply in the country.

Faleke

The House of Representatives Committee on Finance yesterday drilled the Nigerian Bulk Electricity Trading (NBET) company over power purchase agreements that have failed to stabilise electricity supply in the country.

During the exercise, the committee ordered the management of the Niger Delta Power Holding Company (NDPHC) to immediately commence a review of the Gas Purchase Agreement (GSA) between the Federal Government and an unnamed company for the supply of gas to its Calabar power plant.

According to the lawmakers, the company in question uses the same platform to supply gas to other companies, but the country still pays a $10 million monthly commitment as contained in the initial agreement.

The committee was angered that in about 12 of the power purchase agreements entered into by NBET under the ‘Take or Pay’ arrangement, Nigeria’s monthly commitment in one of them alone was about $30 million, whether the Transmission Company of Nigeria (TCN) was able to evacuate for onward delivery to the DISCOs or not.

Chairman of the committee, James Faleke, lamented that millions of Nigerians pass out of school but they have no jobs, adding: “It is because we have no power to provide industries. And that’s why I asked you; are you satisfied with the value for money? When we have no power for industries to establish, why are we paying such monies?

“My expectation will be that you have provided power for let’s say Ariara market, and there, businesses are booming, or an industrial area in a particular state and industries are booming, but the power is not there.

“So, as operators of these agencies, you needed to carry out a review of where we are. It is interesting that the NDPHC is just saying that they read on the pages papers that a company you signed agreement with, to provide you with gas for $10 million a month, static.

“Take or pay, we pay the $10 million, and if we don’t pay, the World Bank will pay, and the moment the World Bank pays, your rating will drop; that is the meaning,” he said.

However, the Chief Executive Officer of NBET, Nnaemeka Eweluka, said the agreements were all entered into without recourse to the Federal Executive Council (FEC), insisting that they were not like normal procurement processes that may require such based on the recommendation of the Bureau for Public Procurement (BPP).

He said he only relied on the advise of the Attorney General of the Federation while the Minister of Finance signs on behalf of the government.

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