Benin Republic and Togo’s Outstanding Electricity Debt to Nigeria: NERC Report Highlights

Benin and Togo owe Nigeria $5.79 million for electricity consumed in Q2 2024 according to the NERC. The total invoice was $15.60 million, with a payment remittance of $9.81 million from international buyers. Payment trends show improvements compared to previous quarters, with a collection efficiency of 79.31% reported for Discos. The federal subsidy obligation was significantly reduced due to tariff policy changes.

The Nigerian Electricity Regulatory Commission (NERC) has disclosed that Benin Republic and Togo owe a combined total of $5.79 million for electricity consumed during the second quarter of 2024. In its recent report, the NERC revealed that, of the $15.60 million invoiced by the market operator from April to June, the international customers managed to remit only $9.81 million. The power buyers from Benin Republic and Togo include Para-SBEE, which owes $1.23 million, in addition to Transcorp-SBEE from Benin and Mainstream-NIGELEC in Togo, which respectively owe $4.25 million and $1.09 million. Odukpani-CEET in Togo, however, relied on Deferred payments, remitting nothing during this period. Historically, during the first quarter of 2024, no payments were received from the four international bilateral customers despite a cumulative invoice of $14.19 million. The latest report notes some developments in payments from bilateral customers for outstanding invoices from past quarters, showing a cumulative total of $16.65 million paid by these customers over time. Additionally, the report indicates that the international bilateral customers achieved a remittance performance of 62.88 percent, while domestic customers contributed approximately N1.30 billion from a cumulative N1.99 billion issued for services provided in Q2 2024. Furthermore, it was reported that between Q1 and Q2 of 2024, the Federal Government of Nigeria witnessed a significant reduction in its subsidy obligation, which dropped from N633.30 billion to N380.06 billion. This adjustment stems from government policy changes regarding the tariff reviews for Band A customers, leaving the rates for Bands B to E unchanged since the end of 2022. The revenue collected by all Distribution Companies (Discos) during the second quarter totaled N431.16 billion from a billed amount of N543.64 billion, equating to a collection efficiency rate of 79.31 percent. This figure reflects a slight improvement over the previous quarter’s collection efficiency of 79.11 percent. Among the Discos, Ikeja and Eko recorded the highest efficiencies at 94.67 percent and 88.03 percent, respectively, while Yola Disco reported the lowest at 55.67 percent.

The article discusses the financial obligations relating to electricity supply owed by Benin Republic and Togo to Nigeria. It highlights the debt figures reported by the Nigerian Electricity Regulatory Commission for the second quarter of 2024, emphasizing the remittance rates from international bilateral customers. The report also sheds light on the trend of payments made toward outstanding bills from prior quarters, overarching governmental policies affecting electricity tariffs, and the operational efficiencies of Distribution Companies across Nigeria.

In summary, the NERC report reveals significant debts owed by Benin Republic and Togo for electricity consumed, highlighting a mixed track record of remittance among international buyers for the second quarter of 2024. While there has been improvement in payment for outstanding invoices, substantial reductions in federal subsidy obligations are indicative of policy changes and tariff adjustments. The operational performance of Nigerian Discos remains a pivotal element in the ongoing electricity supply and revenue collection landscape.

Original Source: punchng.com