The Senate Committee on Power has raised concerns over the growing liquidity crisis in Nigeria’s power sector, citing persistent tariff shortfalls. The committee disclosed that the federal government owes about N200bn to power-generating companies every month.
It further revealed that no payments have been made to power producers since the beginning of the year, pushing the total debt to around N800 billion. The Chairman of the Committee, Senator Enyinnaya Abaribe, made this known during a press interaction at a retreat held in Ikot-Ekpene, Akwa Ibom State.
The retreat, organized by the Nigerian Electricity and Regulatory Commission, aimed to address critical and emerging challenges within the Nigerian power sector and explore sustainable solutions.
Abaribe noted that Nigeria’s total debt now exceeds N4 trillion, comprising over N3 trillion in previous arrears and an additional N800 billion accrued this year. He also stated that the generating companies are indebted to gas suppliers, who cannot continue supplying gas indefinitely without payment.
The Senator, however, expressed optimism that a solution is within reach.
“The hope is this: a decision must be taken by the Federal Government and the state governments because right now, we have two tiers of electricity markets. The state can do it, the Federal Government can do it, so they must all come together and make that decision.
“How do we get out of this? How do we pay for it? Who pays? And so forth, everywhere else in the world, that decision is always taken. Do we decide to subsidize fuel that we all use to run around, or do we see the decision to subsidize electricity that goes to everyone in terms of production? So that’s our choice to make,” he stated.
The Minister of Power, Adebayo Adelabu, while giving an overview of the power sector reforms, highlighted the achievements of the President Bola Tinubu-led administration, particularly the progress made in increasing power generation.
He also outlined the sector’s challenges, including funding constraints and the widespread vandalism of energy infrastructure, stating, “Only in this country are energy equipment being vandalized in such magnitude.”
The Governor of Akwa Ibom State, Umo Eno, represented by his Deputy, Senator Akon Eyakenyi, described Small and Medium Enterprises (SMEs) as the engine of economic growth in most societies, emphasizing that a stable electricity supply is key to unlocking the sector’s full potential.
He expressed hope that with the calibre of resource persons at the retreat, critical issues bedeviling the power sector, would be addressed.
