CBN Disburses N55.5bn to 24 Power Firms

CBN Disburses N55.5bn to 24 Power Firms
Oladejo Amos

The Minister of Power Works and Housing, Babatunde Fashola and the governor of the Central Bank of Nigeria has assured that the backlog of power sector debt will be cleared soon even as N55.456 billion which is the fourth batch of the Nigerian Electricity Market Stabilization Facility (CBN-NEMSF) to operators in the power sector was disbursed.

Speaking at the disbursement of the fund to operators in Lagos on Friday, Fashola and CBN Governor, Godwin Emefiele said they are working together with banks, the distribution, generating and gas companies to ensure that the debt which had halted the disbursement of the facility last year is being serviced.
The CBN had disbursed N55.456 billion out of the N213 billion to 24 industry participants; three Discos, 14 Gencos- NIPP inclusive, one  Service Provider; and six Gascos to further address the challenges of the sector.
According to Emefiele, the disbursement marks a major milestone in the effort of the Bank in collaboration with the Federal Government to achieve a contract based electricity market. It also featured the signing of PPA Activation Agreement by  Nigeria Bulk Electricity Trader (NBET) to signal activation of Industry contracts for Power Generation under a Contract Based Market.
 
Having disbursed the fund, Emefiele, stated the need for  the power firms to invest more in infrastructure so as to ensure the increase in electricity supply in the country. He charged the Discos to invest in the purchase and distribution of meters and transformers to ensure that the consumers are adequately services and are encouraged to pay for the services rendered.
 
Fashola, while stating that the power problem will be resolved if everyone played their part condemned the vandalization of pipelines which he said is one of the major problems facing the sector.
Some people have developed the mindset of vandalizing gas lines, it doesn’t help the country, their communities and their people. Breaking pipelines does increase pollution.”
 
The CBN had one year into the programme, disbursed the sum of N64 billion or 30 per cent of the facility to 18 participants. Five distribution companies had received N41.06 billion; seven generating companies received N18.4 billion while six gas companies received N5.24 billion. 
 
These companies committed to using the funds to upgrade/refurbish their equipment and acquire new ones so as to improve service delivery. The facility was given at 10 per cent interest rate and repayment has commenced according to the CBN