Engr. Edmund Ejie of the Transmission Company of Nigeria (TCN), has disclosed that the Federal Government has approved N600 billion for injection into the country’s electricity market.
Announcing the fund disbursement, Ejie told news correspondents in Abuja that the fund is ripe for disbursement any moment from now.
Ejie said the money disbursed is an intervention fund, which is for the payment of the shortfall in electricity invoices for the entire market.
The TCN boss maintained that the intervention is not restricted to a single chain in the market but a wholistic one.
Why this matter: Since the privatisation of Nigeria’s power sector, there have been rising issues in the sector stakeholders are familiar with. Amongst the issues affecting the sector is the lack of adequate funding.
As recently-reported earlier on Nairametrics, the Federal Government is committed to revamping the power sector, a move that was estimated to cost N736 billion.
What you should know: Following the privatisation of Nigeria’s power sector by the administration of former President Goodluck Jonathan, distribution firms carved out of the defunct Power Holding Company of Nigeria (PHCN), were on Friday, November 1, 2013, handed over to private investors in a bid to facilitate investment growth in the power sector.
Despite this, the power sector has been experiencing serious challenges over power supply and investment growth. The Bureau of Public Enterprises (BPE) in 2018, made known that the five-year performance agreement with the core investors in the DisCos, with the exception of Kaduna DisCo, became effective on Thursday, January 1, 2015, and the fifth anniversary for final performance review would, therefore, be Tuesday, December 31, 2019.
The Ministry of Power, Works and Housing revealed that the need to recapitalise the DisCos is urgent, as the DisCos are ‘technically insolvent’. It, however, described the inability of the DisCosto improve customer service and meet operational costs as a direct consequence of their inability to raise capital.