FG to pay-off N61.6bn legacy debt to Discos before year end
Wobbling from
the heavy weight of historic debts of over N80 billion and short
supply from generation companies, electricity distribution companies
may soon smile as federal government has decided to pay up its legacy
electricity bills.
Minister of Power, Works and Housing, Babatunde Fashola who disclosed this at the Podium, a public dialogue event organized by the Kukah Centre, said the Debt Management Office has concluded plans to wind down the debts owed by federal ministries, departments and agencies.
He however lamented that effort to improve electricity generation has been severely hampered by the continuing vandalism of pipelines supplying gas to power plants across the country.
Fashola noted that unless new energy sources are brought to the grid, militants and other criminal elements will continue to hold the country at ransom with frequent pipeline breaks.
He said: “MDA debts, we are in the process of winding down that debt, I have written to the debt management office and I got a response from them just two days ago proposing options to wind down the debts and I think as government, we must live by example, if we ask people to pay for what they use, then we must pay as well and I am determined to ensure that we do that.
“The ministry of defence through the minister is also acting in concert and it is something we hope that before the end of the year, we wind down”.
The minister said he got approval two days ago to disburse what was approved in the 2016 budget for his ministry and which has now been given to the ministry. He said contractors of the ministry, majorly road contractors will now be paid monies owed them by the government. The Discos had through their platform, the Association of Nigerian Electricity Distributors (ANED) said that government’s MDAs owed it huge debts for electricity they consumed but did not pay over the years.
ANED gave a breakdown of the debt profile in which the Nigerian Army was the single largest debtor to the Discos with N38.75 billion; the Nigerian Airforce followed in the inglorious list with N3.09 billion, Navy - 3.3 billion, Police - N4.66 billion, Customs - 528.78 million, Prisons - N895.6 million and Immigration - N47.8 million. The MDAs also owed the Discos N9.98 billion in unpaid electricity bills.
On the increased spate of pipeline vandalism, he explained that because of such frequency in breakage of pipelines that supply gas to thermal power plants in the country, the federal government has stepped up its effort to diversify the country’s energy sources.
He noted that the effort will include accelerating works on several hydro power projects, as well as other energy sources with the potential to minimise the impact that such cuts in gas supply exert on the country’s electricity sector.
“Repeated acts of vandalism have rendered us vulnerable and we have to proactively move to overcome that one single source of supply. This is a journey of diversification and energy security, and it will make it impossible for anyone to hold the country to ransom on energy supply.”
He also stated that works on other bigger hydro plants like the Zungeru, Kashimbila and Mambilla would be accelerated, adding that work on Zungeru has resumed after unplanned interruption.
“I have always asked myself, why should I damage an asset that serves me because I am angry? It is a matter of public ownership and collective trust that anyone who tampers with it tampers with all of us and so no matter how angry you are, you must find another way to ventilate your anger, otherwise, it just doesn’t make sense to me,” he said in reference to the breaks by militants”, he added.
Minister of Power, Works and Housing, Babatunde Fashola who disclosed this at the Podium, a public dialogue event organized by the Kukah Centre, said the Debt Management Office has concluded plans to wind down the debts owed by federal ministries, departments and agencies.
He however lamented that effort to improve electricity generation has been severely hampered by the continuing vandalism of pipelines supplying gas to power plants across the country.
Fashola noted that unless new energy sources are brought to the grid, militants and other criminal elements will continue to hold the country at ransom with frequent pipeline breaks.
He said: “MDA debts, we are in the process of winding down that debt, I have written to the debt management office and I got a response from them just two days ago proposing options to wind down the debts and I think as government, we must live by example, if we ask people to pay for what they use, then we must pay as well and I am determined to ensure that we do that.
“The ministry of defence through the minister is also acting in concert and it is something we hope that before the end of the year, we wind down”.
The minister said he got approval two days ago to disburse what was approved in the 2016 budget for his ministry and which has now been given to the ministry. He said contractors of the ministry, majorly road contractors will now be paid monies owed them by the government. The Discos had through their platform, the Association of Nigerian Electricity Distributors (ANED) said that government’s MDAs owed it huge debts for electricity they consumed but did not pay over the years.
ANED gave a breakdown of the debt profile in which the Nigerian Army was the single largest debtor to the Discos with N38.75 billion; the Nigerian Airforce followed in the inglorious list with N3.09 billion, Navy - 3.3 billion, Police - N4.66 billion, Customs - 528.78 million, Prisons - N895.6 million and Immigration - N47.8 million. The MDAs also owed the Discos N9.98 billion in unpaid electricity bills.
On the increased spate of pipeline vandalism, he explained that because of such frequency in breakage of pipelines that supply gas to thermal power plants in the country, the federal government has stepped up its effort to diversify the country’s energy sources.
He noted that the effort will include accelerating works on several hydro power projects, as well as other energy sources with the potential to minimise the impact that such cuts in gas supply exert on the country’s electricity sector.
“Repeated acts of vandalism have rendered us vulnerable and we have to proactively move to overcome that one single source of supply. This is a journey of diversification and energy security, and it will make it impossible for anyone to hold the country to ransom on energy supply.”
He also stated that works on other bigger hydro plants like the Zungeru, Kashimbila and Mambilla would be accelerated, adding that work on Zungeru has resumed after unplanned interruption.
“I have always asked myself, why should I damage an asset that serves me because I am angry? It is a matter of public ownership and collective trust that anyone who tampers with it tampers with all of us and so no matter how angry you are, you must find another way to ventilate your anger, otherwise, it just doesn’t make sense to me,” he said in reference to the breaks by militants”, he added.
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