Nigeria’s electricity supply industry faces a mounting financial crisis as international customers from Benin and Togo have failed to remit $14.19 million in payments for power supplied in the first quarter of 2024.
This troubling revelation was disclosed by the Nigerian Electricity Regulatory Commission (NERC) in its latest report.
The power debts are owed by four foreign companies: Para-SBEE in Benin Republic, Transcorp-SBEE in Benin, Mainstream-NIGELEC in Togo, and Odukpani-CEET in Togo.
These companies received invoices totaling $14.19 million for electricity services rendered by Nigeria’s power generation companies in the first quarter, yet none made payments, according to the NERC report.
The individual breakdown reveals that Para-SBEE owes $3.15 million, Transcorp-SBEE is behind by $4.46 million, Mainstream-NIGELEC owes $1.21 million, and Odukpani-CEET is indebted by $5.36 million.
The report also highlights a broader issue of payment indiscipline among both local and international bilateral customers within the Nigerian power sector.
In the same period, no remittances were made by bilateral customers in Nigeria against a cumulative invoice of N1.86 million issued by the market operator.
However, the report did show some progress in addressing long-standing debts. Two international customers made partial payments totaling $5.96 million for outstanding invoices from previous quarters, while eight local bilateral customers settled N505.71 million worth of pre-2024 debts.
Despite these efforts, the continued failure to settle current electricity bills remains a significant concern for Nigeria’s power industry.
This trend of non-payment is not new; in 2023, international consumers failed to remit about $51.26 million for electricity supplied from Nigeria, highlighting the persistent challenge in collecting revenue from power exports.
The NERC report described this situation as “payment indiscipline” and called for urgent intervention by the Market Operator, a division of the Transmission Company of Nigeria (TCN), which oversees Nigeria’s power exports.
The commission urged the Market Operator to invoke the provisions of market rules to curtail these ongoing defaults and enforce compliance among power buyers.
The rising debts pose a serious threat to Nigeria’s power sector, which is already grappling with challenges such as inadequate infrastructure and inconsistent electricity supply.
The failure of foreign companies to meet their financial obligations further exacerbates the sector’s difficulties, limiting the funds available for critical investments in generation and transmission capacity.
