The Nigerian government is considering regulatory measures to recover a significant debt of $14.2 million (approximately N21.3 billion) owed by four African countries for electricity supply.
The Nigerian Electricity Regulatory Commission (NERC) has instructed the Electricity Market Operator (MO) to enforce market rules to facilitate debt recovery. This action comes as international customers have failed to settle their obligations despite repeated requests. The debt accumulated in the first quarter of 2024.
The MO, responsible for overseeing the Nigerian Electricity Supply Industry (NESI) market rules, ensures the efficient operation of the electricity market.
According to NERC’s Q1 2024 report, the commission is concerned about the non-payment for supplied energy by international customers, prompting measures to recover the debt through the MO.
The countries owing Nigeria are Niger Republic (NIGELEC), Benin Republic (Société Béninoise d’Energie Electrique – SBEE), and Togo (Togo Electric Energy Company – CEET).
The report noted, “None of the four international bilateral customers being supplied by Generation Companies (Gencos) in the NESI made payment against the cumulative invoice of $14.19 million issued by the MO for services rendered in 2024/Q1.
“As indicated in previous reports, the commission expects the MO to invoke market rules to address the payment indiscipline exhibited by local and international bilateral customers.”
While some international customers still owe Nigeria, two made payments totaling $5.96 million towards their outstanding invoices from previous quarters, representing a partial settlement of their debt backlog. Additionally, some local bilateral customers also made payments for their outstanding invoices.
The report highlighted that bilateral customers failed to make any payments towards the outstanding invoice of N1.86 billion for services provided in Q1 2024. However, the MO received a partial payment of N505.71 million from eight local bilateral customers, which was applied towards settling their pre-2024/Q1 debt obligations. No payments were made towards the current invoices for Q1 2024.
“The special customer (Ajaokuta Steel Co. Ltd and the host community) did not make any payment towards the N1.27 billion Nigerian Bulk Electricity Trading (NBET) and N0.09 billion (MO) invoices received in 2024/Q1.
“This continues a longstanding trend of non-payment by this customer and the commission has communicated the need for intervention on this issue to the relevant federal government authorities. A continuation of the non-payment may trigger total disconnection from the grid,” it added.
