The Managing Director and Chief Executive Officer of Niger Delta Power Holding Company Limited, (NDPHC), Chiedu Ugbo, has decried low invoice payment for energy generated.

The GenCo is owed over N180bn debt.

According to Ugbo, huge indebtedness had impacted on the speed at which the company would have improved power services in the country,

The NDPHC boss who disclosed this while interacting with journalists in Lagos, however noted  that the company is living up to expectations to ‘Light Up Nigeria’.

 “There is also low invoice payment for energy generated to the grid. There is huge indebtedness by the market to NDPHC in hundreds of billions for unpaid invoices. NDPHC is also not paid for availability but only as dispatched thereby depriving NDPHC of hundreds of billions (N) since 2015 when transitional electricity market (TEM) was declared,” he said.

 “To reasonably resolve the challenges to power plants’ operations and increase electricity supply to homes and businesses, NDPHC’s Light-up Nigeria initiative is to explore not only the opportunities under the Eligible Customer Regulations and Electricity Act 2023 but also bilateral power sales in collaboration with Discos and other bulk purchasers under trading arrangements will ensure that investment is mobilized for end-to-end solutions that will guarantee that electricity is delivered to customers and NDPHC is paid for the electricity generated.

“At the core of NDPHC’s initiatives is to prioritise high-value power sale opportunities with bulk purchasers and Discos, which under Nigerian Electricity Supply Industry (NESI) have significant power supply demands across their franchise areas. The rationale for this approach is that projects delivered in collaboration with these potential bulk purchasers are likely to generate significantly greater volumes of power sales under bankable arrangements.”

In 2022, transmission and distribution available capacity was estimated at about 5,500MW. Ugbo informed that  NDPHC was currently allocated a maximum dispatch space of 975MW (peak period) and 757MW at off-peak (despite often being substantially mechanically available).

He said: “Talking more about constraints, evacuation limitation is further exacerbated by systems operations (SO’s) frequent start-up & shut down instructions to the plants ostensibly for frequency and load control to ensure system safety and reliability but resulting in increased turbine stress, more unscheduled outages, and significant maintenance costs.

“Another challenge is gas supply and transportation constraints. There is an unavailability of sufficient volumes of gas to guarantee generation up to the Transmission Company of Nigeria (TCN) allocated evacuation capacity of 975MW let alone the full capacity of its power plants.

“Calabar is the only plant with a full gas supply. Plants in the western axis require about 150MMSCF/day to meet the TCN-allocated evacuation capacity of 535MW (Peak).

“Gas supply to western axis power plants is further challenged by low pressure on NGIC gas pipelines –ELPS & Oben-Ajaokuta. Gas suppliers want higher gas tariff beyond industry approved gas tariff ($2.50 vs. $2.18).”