The Federal Government's claim that the total debt in Nigeria's electricity sector is approximately N4 trillion has been met with resistance from power generation companies (GenCos). The companies insist that the actual debt figure is significantly higher, estimating it at around N6.3 trillion. The disagreement stems from the government's assertion that only N2.8 trillion has been officially verified through auditing, while GenCos argue that this figure is incomplete and does not account for various other outstanding payments.
The Minister of Power, Adebayo Adelabu, explained that the government's position is based on ongoing efforts to review and reconcile the debt. He noted that the calculations involve several factors, including interest on unpaid sums and changes in foreign exchange rates. However, GenCos have rejected the government's position, stating that any accurate figure must come from a joint reconciliation process involving all stakeholders in the power sector.
The dispute is occurring at a time when the Federal Government is attempting to reform the electricity sector by clearing old debts, improving transparency, and making the market more financially stable. Industry experts warn that if the issue is not resolved quickly, it could discourage investors and worsen the already fragile power supply situation in the country.
The ongoing dispute between the Federal Government and power generation companies over the debt in Nigeria's electricity sector is a stark reminder of the sector's chronic inefficiencies. The government's insistence that the debt is only N4 trillion, while GenCos claim it is N6.3 trillion, highlights the lack of transparency and accountability in the sector. The fact that over 60 percent of the debt is tied to gas supply underscores the critical need for a reliable and efficient gas supply system. The Federal Government must take concrete steps to address these issues and ensure that the sector is reformed in a way that benefits everyday Nigerians. The country cannot afford to continue with the current power outages and financial challenges in the sector.
