The Senate Committee on Power has raised concerns over the liquidity crisis bedeviling the power sector, lamenting that tariff shortfalls have indicated that the government is owing a whopping N200bn to generating and distribution companies every month.
The Committee’s chairman, Senator Enyinnaya Abaribe, disclosed this while fielding questions from journalists during the retreat held in Ikot-Ekpene, Akwa Ibom State, on Saturday.
The retreat, jointly organised with the Nigeria Electricity and Regulatory Commission, aims to provide solutions to “critical and emerging issues in the Nigerian Power sector.”
Abaribe expressed worries that the government is yet to make any payment to the distribution companies this year, 2025, indicating that the country is already indebted by N800bn in addition to previous indebtedness amounting to over N3 trillion.
“I will not be able to just, in this short interview, give you the statistics of these things. But one key statistic is very, very necessary for Nigerians to know.
“There’s a liquidity crisis in the power sector. The generating companies are owed so much, the distribution companies are also owed so much.
“The tariff shortfalls that we have mean that every month the government owes N200 billion in payments, and for this year, 2025, no payment has been made. In other words, we’re already short by N800 billion. Prior to this time, we had about N3 something trillion debt to the generating companies.
“The generating companies owe the gas suppliers. The gas suppliers cannot just continue to supply gas indefinitely ” Abaribe said.
The senator, however, expressed the hope that there is light at the end of the tunnel.
According to him, “The Hope, really is this, a decision must be taken by the Federal Government and the state governments because right now, we have two-tier 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 take the decision to subsidise fuel that we all used to run around, or do we see the decision to subsidise electricity that goes to every one of us in terms of production. So that’s our choice to make.”
Minister of Power, Adebayo Adelabu, while giving an overview of the power sector reforms, highlighted the achievements of the President Bola Tinubu-led administration, especially in the area of increase in magawatt generation.
He also listed the challenges of the sector to include funding and vandalization of energy equipment, among others saying “only in this country are energy equipment are being vandalised in such magnitude”
In his remarks, Governor of Akwa Ibom State, Umo Eno who was represented by his deputy, senator Akon Eyakenyi, described Small and Medium Enterprises as the engine of economic growth in most societies noting that only steady electricity supply can unlock the sector
He expressed the hope that the caliber of resource persons at the retreat critical issues bedeviling the power sector would be addressed.
