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NBET owes Egbin Power N388bn debt

Egbin Power promotes sustainability through medical outreach

Egbin Power plc, one of the largest power generating companies in Nigeria, has said it is owed over N388 billion by the Nigerian Bulk Electricity Trading plc (NBET) for electricity generated and fed into the national grid.

The government-owned NBET buys electricity in bulk from generation companies through Power Purchase Agreements and sells to the distribution companies, which then supply to the consumers.

According to Kola Adesina, Chairman of Egbin Power, the current debt profile of NBET with the generation company may put a question mark on the country’s sanctity of contracts.

Despite challenges, Adesina notes that the company has invested $1 billion in Nigeria’s power sector and is further perfecting an investment plan of additional $2 billion for expansion.

He gave the breakdown to include $1.8 billion for Egbin Power 2 and overhaul of the existing plant as well $200 million for estate (quarters).

“The plant, which is the biggest in sub-Saharan Africa with a capacity of 1,320mw, was generating 400mw at the time we took over. But today the generation has surged to above 800mw,” Adesina said when the Senate Committee on Privatisation and Commercialisation paid a facility visit to the company’s plant in Egbin, Lagos.

He said, “At some points, we generated 1,100mw. We have been doing an average of 1,000mw this year.

“Despite these, there are challenges we face that we want this Committee to help us with. The NBET still owes Egbin a debt of N388 billion including money for actual energy wheeled out, and interest for late payment.”

Read also: Egbin power seeks $2bn in equity and debt to double output

In addition, he noted that there were challenges of gas limitations, which cost the generating firm about 106.34mw since June 2020 due to external constraints.

“In 2021 alone, we have lost N13.68 billion to these external constraints,” he said, but believes his company would stop at nothing to hasten Nigeria’s course for steady power supply.

He said Sahara Group, owner of Egbin, has also invested in distribution stratum of the power industry through the Ikeja Electric.

“We know that there is a need for a handshake between the generation and distribution. An average Nigerian doesn’t understand what Megawatt means. What he or she understands is to press his or her switch and the bulb is lighted,” he said.

Meanwhile, the Senate Committee on Privatisation and Commercialisation has thrown its weight behind the $2 billion future investments plan by Egbin Power.

The committee, in a reaction during the visit to Egbin, maintained that the plant has “done well” in justifying October 1, 2013 power sector’s privatisation by the Federal Government.

Chairman of the committee, Theodore Orji, who led the delegation that included deputy chairman of the committee, Adelere Oriolowo; Issa Jubril; Saibudeen Oduniyi of BPE, Clerk of the Committee, Abdullai Sadiah, queried the transmission and gas constraints, which have downed the power available below actual generation capacity.

Noting that Egbin is “doing fine” with its post privatisation investments and activities, Senator Orji stated that the plant, which has invested about $1billion in the last seven years, should be encouraged to do more.

“This is a fact-finding mission about the power privatisation. We are encouraged by what we have seen at Egbin and we shall go back to the Senate to give our report on the entire process.

“I can say that you are trying your best. You are doing fine and you should be encouraged to do more in terms of investments,” he said.