- The Chairman of the Senate Committee on Power, Senator Gabriel Suswam, has revealed the entities owing the highest electricity debts to Distribution Companies (DisCos) in Nigeria.
- State governments, educational institutions, and military formations are listed as the major debtors, hindering the DisCos’ ability to invest in power infrastructure and upgrade operations.
- To address the issue, Suswam proposed deducting allocations from defaulting governments and agencies.
- In response, the Minister of State for Power, Mr Abubakar Aliyu, highlighted that despite highly subsidized electricity in Nigeria, the country faces a high rate of defaulting consumers.
- Aliyu compared the cost of electricity in Nigeria with neighboring countries, emphasizing Nigeria’s relatively lower tariff.
Senate Identifies Major Electricity Debtors in Nigeria
The Chairman of the Senate Committee on Power, Senator Gabriel Suswam, has unveiled the entities responsible for the highest electricity debts owed to Distribution Companies (DisCos) in Nigeria. Among the top debtors are state governments, educational institutions, and military formations, according to a report by The Nation. The accumulated debts of these government agencies have significantly hindered the DisCos’ ability to invest in power infrastructure and upgrade their operations.
In an interactive session with Mr Abubakar Aliyu, the Minister of State for Power in Abuja, Senator Suswam proposed a solution to the issue by suggesting that the Ministry of Finance deduct allocations to the defaulting governments, ministries, and agencies. This measure aims to hold the debtors accountable and compel them to settle their outstanding electricity bills.
In response to Senator Suswam’s revelation, Minister Abubakar Aliyu emphasized that electricity tariffs in Nigeria are among the cheapest globally due to the high subsidies provided by the Federal Government. To support his claim, Aliyu compared the cost of electricity in Nigeria with its neighboring countries. While the cost of electricity in Nigeria stands at 15 cents per kilowatt, it amounts to 42 cents in Niger Republic, 23 cents in the Republic of Benin, 25 cents in Mali, 28 cents in Senegal, and 27 cents in Burk
The high rate of defaulting electricity consumers in Nigeria despite the subsidized rates puzzled Minister Aliyu. He questioned why, with such affordable tariffs, the country still faced a significant number of consumers failing to pay their electricity bills promptly.
The growing debts owed by government agencies to DisCos pose a grave threat to the sustainability of the power sector in Nigeria. Despite the efforts of the Nigerian Electricity Regulatory Commission to address the issue, the cycle of debt continues to escalate. As a result, power outages and supply disruptions have become more frequent, negatively impacting businesses and households across the nation.
In related news, it was revealed that the Republic of Benin, Niger, and Togo owe a total sum of N22.55 billion in electricity bills to Nigeria. The Nigerian Electricity Regulatory Commission’s quarterly reports and sales records indicate the amounts billed to these countries over the years. In 2018, they were billed N50.01 billion, followed by N30.03 billion in 2019, N16.22 billion in 2020, N7.67 billion in 2021, and N4.66 billion in 2022. However, the amounts collected during the same period were N9.62 billion, N56.94 billion, N12.06 billion, N2.9 billion, and N4.62 billion, respectively.
The outstanding debts owed by these neighboring countries further compound the financial challenges faced by the Nigerian power sector.
In conclusion, the Chairman of the Senate Committee on Power has identified state governments, educational institutions, and military formations as the major debtors in Nigeria’s electricity sector. Their cumulative debts have hampered the DisCos’ ability to invest in infrastructure and upgrade operations. While the Minister of Power highlights Nigeria’s highly subsidized electricity, the country still faces a significant rate of defaulting consumers. The mounting debts owed by government agencies and neighboring countries pose significant challenges to the sustainability of the power sector. It is crucial for measures to be taken to address these issues promptly and ensure the efficient delivery of electricity services to businesses and households.
Source: Editorial Times