The Senate yesterday questioned the Nigerian Bulk Electricity Trading Plc (NBET) over the rising debt in the country’s power sector.
During a budget defence session, members of the Senate Committee on Finance were informed by NBET’s Acting Managing Director and CEO, Johnson Akinnawo, that outstanding liabilities across the electricity value chain had reached about N3 trillion.
Lawmakers raised concerns about the agency’s performance, funding gaps, and the persistent disparity between electricity tariffs and the actual costs of power generation, transmission, and distribution.
Akinnawo explained that regulatory income is intended to cover recurrent expenditure and reduce overheads for market participants. He revealed that although N858 billion was appropriated for NBET in 2025, only N60 million was released.
“At the close of the year, only N60 million was released toward the end of the year. Unfortunately, that affected our budget performance,” he said.
Committee Chairman Mohammed Musa noted that while market receipts appeared strong on paper, the sector remained unstable. “In your page three, market receipts look good. We understand this is a transitional arrangement, but if performance is strong, the market should be sustainable,” Musa said.
Akinnawo, however, highlighted that a structural deficit persists. “There remains a gap between the cost of generation, transmission, and distribution of electricity and what is being recovered,” he explained.
Senator Abdul Ningi questioned intervention spending, noting that nearly 60 per cent of NBET’s appropriations were earmarked for intervention. Akinnawo clarified that distribution companies remit collections used to pay generation companies, but payments are constrained by low collections and funding shortfalls.
“Every GenCo is paid on a pro-rata basis from whatever collections come from the DisCos. Azura is paid like every other GenCo,” he said. He added that the Federal Government, through the Ministry of Finance, covers funding gaps arising from partial risk guarantees.
The committee chairman criticised the non-release of appropriated funds, noting that such disbursements should have been made to bridge the gap between DisCos’ collections and payments due to GenCos.
Akinnawo also flagged foreign exchange exposure, explaining that generation tariffs are dollar-indexed. On the debt profile, he said reconciliation is ongoing under a presidential power sector debt reduction committee chaired by Finance Minister Wale Edun.
“As of now, the debt is in the region of N3 trillion,” he said.
He added that NBET’s N858 billion 2025 budget proposal was reduced to N601 billion, and the N60 million released was tied to a N200 million project that could not be executed in parts due to procurement rules.
The Senate committee directed NBET to provide a detailed breakdown of revenues and expenditures for proper assessment.
