Nigerian govt reveals $14m electricity debt owed by Niger Republic, Togo, others

The Nigerian Electricity Regulatory Commission (NERC) has disclosed that numerous international customers, including Niger Republic, Togo, and other neighboring countries, owe Nigeria a substantial $14.19 million in unpaid electricity bills for the first quarter of 2024.

Despite continued efforts to recover these payments, the debt has been steadily increasing, raising concerns about the financial stability of Nigeria’s power sector.

According to the NERC recent report, these debts are part of a larger issue where international electricity consumers have historically delayed payments, with last year’s figures revealing an outstanding $51.26 million owed to Nigeria for electricity exports.

In response to this ongoing issue, the Federal Government, in May, directed system operators within the Nigerian power sector to restrict electricity exports to international customers to a maximum of 6% of the total available grid generation per hour.

This measure aims to ensure that domestic electricity needs are prioritized amidst the accruing debts.

The NERC report highlighted that none of the four international customers, including Benin Republic, Niger Republic, and Togo, settled their electricity invoices for services rendered in the first quarter of 2024.

The Market Operator (MO) issued these international bilateral customers an invoice amounting to $14.19 million, which remains unpaid. Similarly, domestic bilateral customers did not make any payments against a cumulative invoice of N1,860.11 million for the same period.

The report also noted that payments were made for outstanding balances from previous quarters. Specifically, two international customers paid approximately $5.19 million, while eight domestic bilateral customers settled around N505.71 million in past dues.

Regarding the performance of Distribution Companies (DisCos), the report indicated that they were invoiced a total of N114.12 billion for upstream services, which included N65.96 billion for generation costs and N48.16 billion for transmission and administrative services.

The DisCos collectively paid N110.62 billion, leaving an outstanding balance of N3.50 billion. This resulted in a remittance performance of 96.93%, showing a significant improvement from the 69.88% recorded in the fourth quarter of 2023.

Additionally, the report revealed a decline in the average available generation capacity across all power plants in Nigeria, which fell to 4,249.10MW in Q1 2024, down by 13.68% (or 673.16MW) from the 4,922.26MW recorded in Q4 2023. This reduction was attributed to decreased generation capacities at 17 of the 27 grid-connected power plants.

The average hourly generation of available units also saw an 8.22% decline (or 364.25MWh/h), dropping from 4,433.82MWh/h in Q4 2023 to 4,069.57MWh/h in Q1 2024. Consequently, total electricity generation decreased by 9.21% (or 901.94GWh), from 9,789.87GWh in Q4 2023 to 8,887.93GWh in the first quarter of 2024.

This overall decline in gross energy generation is primarily linked to the reduced capacities of grid-connected power plants compared to the previous quarter, further emphasizing the need for both local and international customers to adhere to their financial obligations to support the stability of Nigeria’s power sector.