• Monday, March 04, 2024
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BusinessDay

FG blames gas shortage, debt for Nigeria’s power crisis

Nigeria faces N1.6 trn power tariff shortfall, minister warns

Nigerians may begin to pay a full-cost electricity tariff as Bayo Adelabu, the minister of power, has blamed the epileptic power supply on the underutilization of the power plant.

According to Adelabu, the inability of power plants to operate to full capacity is due to unpaid debts and low gas supply.

Adelabu during an inspection of the Olorunshogo Power Plant in Papalanto, Ogun State and the Omotosho Power Plant in Ondo State on Wednesday said, “I am amazed at the level of under-utilisation of these power installations.”

“The power plant managed by Niger Delta Power Holding Company operates below 25 per cent capacity, this capacity is poor at a time the country requires electricity.

“The under-capacity utilisation is due to a variety of reasons. The major part of it is the shortage in gas supply to these installations.

“Which is why I needed to see these plants myself. To look at what can be done to improve the operational capacity of these plants.

“What can we do to repair those turbines that are down? What can we do to support these power plants to operate at impressive capacity? So that power supply will improve nationwide.”

Speaking on the debt accrued over time, Adelabu said Generation Companies (GenCos) are being owed as a result of electricity subsidies to the Federal Government.

The minister said, “And we also want to appeal to the Federal Government that once there is a subsidy promise, it has to be fully funded.

“If our government is not ready to fund subsidies, it is better for us to migrate to a fully cost-reflective tariff.

“This is because liquidity is a major issue in the sector, which has led to a huge debt being owed power power-generating companies. And once they are owed, they are also unable to pay the gas suppliers.

“When the gas suppliers are not paid, they will be unwilling to supply regular gas to them. So why are these debts piling up? Part of the debts are owed by the DisCos. The Federal Government is also owning a huge portion of these debts, which relates to the unfunded portion of the subsidy,”.

He also promised that efforts were on top gear to make power available to Nigerians, especially through reliable energy sources.