Following dissatisfactions with reported claims of current level of investments in the electricity sector by the Power distribution companies, federal government on Thursday, said it will carry out detailed forensic audit of the accounts of DISCOs
The aim is to enable government know how much that has been invested in the power sector so far by all the various stakeholders since the 2014 power privatization exercise
The governors said to be grossly displeased over reported demands by Electricity distribution companies DISCOs asking for additional $100 billion about N36 trillion, into the sector over a period of 20 years before the power sector can achieve stability
They are also worried that the current administration has invested additional N1.74trillion since it assumed office in 2015 without corresponding results.
BusinessDay gathered that the Association of Nigeria Electricity Distributors who are currently engaged in negotiations with federal government are requesting for $10b within the next five years
Federal government had at a recent meeting of the Federal Executive Council, said cannot continue to subsidize the DISCOs, following failures to remit funds collected from consumers
“ They collect 3,000 megawatts and pay for only 1,000 megawatts, that is 15 percent of what they are collecting, so government is the one completing the payment. So we cannot continue like that.
The Discos are also facing challenges of lack of capacity to distribute the 13,000 megawatts, generated
“The power generation companies have capacity to generate 13,000megawatts, but Transformation Company can only transmit 7, 000 megawatts, while the DISCOs take only 3000 megawatts and pay government money for just 1000 megawatts.
“ We cannot continue to subsidize power distribution, so I have made recommendations to FEC on the next line of action.”
Details shortly
Deputy Governor of Edo State, Philip Shaibu disclosed this while briefing State House Correspondents after the Monthly National Economic Council NEC meeting presided over by Vice President Yemi Osinbajo at the Council Chambers of the Presidential Villa, Abuja.
“I think the federal government is trying to take the bull by the horn by trying to find out what investments these DISCOS made towards this privatization. The first suspicion is that they have made no substantial investment and we will take it when we get all the solutions”
Federal government also directed all the State governments to furnish it with total investments they have committed into the power sector so far.
Shaibu who was flanked at the briefing by Lagos State Governor, Babajide Sanwo – Olu and Ebonyi state Governor, Dav Umahi, also directed state governments to furnish the NEC committee headed by Nasir El- Rufai, the total investments of each state before the end of March.
Shaibu, while providing update on the ownership structure of electricity distribution companies, said NEC , a body comprising the federal government and governments of the 36 states of the federation approved request by El- Rufai committee to carry out “comprehensive forensic audit of bank accounts of DISCOs, Abdul has directed States to file account of their investments in the DISCO to-date”
“ The committee requested for additional two months to enable it complete its assignment
“ Of course nobody is happy with the DISCOS performance and we have a committee chaired by the governor of Kaduna state and they have done very beautiful job.
“They have placed advertisements in about five newspapers and have asked the general public to give them information on performance of these DISCOS and also investments made by private individuals and private sectors. And also the governors are requested before the end of March to also submit all their investments from 2013 to date, so that we will get it all together and were directed by the electricity authority to stamp our claims.
Explaining while the Excess Crude Account fell from $325m to the current paltry $71.813m, Ebonyi State Governor, Dav Umahi said the Governors had agreed to invest the sum of $250m on infrastructure development through the Nigeria Sovereign Investments Authority, NSIA, while the remainder was used to pay consultants investigating the NNPC accounts
He however, added that the “ transactions in the NNPC, this would have cost the government about $500m”
Firstly, $250 million was an agreed investment by governors and federal government on NSIA – National Sovereign Investment Authority and they are doing very well. They are handling our infrastructure so nicely that it was further agreed that we should reinvest into it. When these investments are made the federal, state and local governments all get their investment certificate. So we are together in this.
“ You also asked where is the other $4 million, it was used in paying consultancy and services that would have caused the fund about $500 million, it was renegotiated to $4 million because, some people went to court over certain transactions in NNPC and so federal government had to engage consultant to handle that.
“We would have paid the consultant five percent of the cost that they were seeking and it would have translated into $500 million. So if you add $250 million plus $4 million you will get $254 million and if you add $71 million you get $325 million, we are back to where we were. So no money is missing.
Tony Ailemen, Abuja
