The Federal Government has stepped in to prevent a nationwide blackout after gas suppliers halted deliveries to power generation companies (Gencos) due to outstanding debts amounting to N2.7 trillion.
On Thursday, power generation rose to 3,624.34 megawatts after engineers from the Transmission Company of Nigeria (TCN) restored the national grid, which had collapsed the day before, marking the 12th grid failure this year.
Gas suppliers had suspended supply to Gencos earlier in the week, citing unpaid bills, which resulted in a sharp drop in power generation. With 70% of Nigeria’s electricity generated by gas-fired plants, a prolonged supply halt could have led to severe nationwide blackouts.
Officials from the Federal Ministry of Power confirmed that the government intervened to resolve the crisis. “The government cannot allow gas supply to be cut off,” an anonymous official stated. While specific details remain undisclosed, it is believed that the government is working on settling part of the gas debts to ensure continued power generation.
Dr. Joy Ogaji, CEO of the Association of Power Generation Companies, revealed that Gencos have been receiving minimal payments from the Nigerian Bulk Electricity Trading Plc (NBET), leading to severe financial strain. “The total debt has now increased to over N2.7 trillion,” she noted, adding that only 9% of thermal Gencos’ invoices are being paid, forcing Gencos to share the burden with gas suppliers.
Earlier this year, Power Minister Adebayo Adelabu announced plans to begin offsetting outstanding debts from April 2024, prioritizing foreign exchange allocation to the power sector to enhance generation capacity.
Despite these efforts, the recurring grid collapses and financial challenges highlight the fragility of Nigeria’s energy infrastructure, underscoring the urgent need for comprehensive sector reforms.
