The Speaker of the House of Representatives, on Tuesday urged the Federal Government to have a rethink over privatisation of power companies in the country.
The speaker made the call during the investigative Public Hearing, organised by the House Committee on Power.
The public hearing is on the need to halt the plan to raise a Federal Government- Secured Bond of N309 billion to finance the shortfall in the Nigerian electricity market.
Experts define market shortfall as the amount of electricity transmitted to the distribution companies (DisCos) and invoiced, in any given month.
It is less the amount remitted by the DisCos to pay the market participants for electricity supplied.”
Dogara was represented by the Minority Whip, Rep. Yakubu Barde.
He noted that Federal Government embarked on privatisation of the defunct Power Holding Company of Nigeria (PHCN) and Electric Power Sector reform programme to bring about efficiency in the Industry.
Dogara, however, said that since the unbundling of PHCN and transfer of the businesses to the privately-operated Successor Companies on Nov. 1, 2013, ‘’we have not had good report from the electricity market’’
He stressed that statistics showed an abysmal situation of things, adding that if the trend continued, there might be need to be to have a fundamental re-thinking of the privatisation process in Nigeria.
“Duration of uninterrupted supply is average six to eight hours per day.
‘’Metering of customers is dismal. Crazy estimated bills are used to exploit consumers.
“Generation capacity has not improved; yet, tariffs were increased in February 2016,” he said.
He noted that in spite of all these, there were reports that the cumulative market shortfall had risen to over N700 billion as of date.
“This trend escalates at the rate of about N25.6 billion monthly from Nigerian Bulk Electricity Trading Company plc’s (NBET) August 2016 Electricity Market Payment Report.
“Our concern in the House of Representatives is, which should come first, stopping the bleeding of the market revenue by putting controls in place or raising a bond to cover the incessant shortfall?.
“Why is this Bond secured by the Federal Government in a privatised market operated by private entities.
“What is the performance of the N213 billion stabilisation facility availed the operators by the Central Bank of Nigeria in March 2015?
“What is the role of the Nigerian Electricity Regulatory Commission (NERC) in this process? .Who will bear the cost of the facility, consumers or the operators? How would this impact on the electricity tariff.
“My expectation is that, all these issues would be brought to the fore at this Investigative Hearing and Nigerians will be well enlightened on what is going on in our electricity market.”
Dogara, therefore, called on the committee to do its job well and report back to the House soon.
Earlier, the Minister of Power, Works and Housing, Mr Babatunde Fashola, said that the bond, combined with promissory note, would help the sector greatly to provide funding.
Fashola, who was represented by Mr Louis Edozien, Permanent Secretary, Power, added that it would resolve significant proportion of the current liquidity challenge in the sector.
“It would be in the public interest if the house supports NBET to complete the design of the product and expedite its implementation,” he said.
The Chairman of the committee, Rep. Dan Asuquo, said, that the committee held the investigative hearing to fulfil doctrine of transparency and to appraise the rationale behind the borrowing.
“It is pertinent to note what role the Nigerian Electricity Regulatory Company (NERC) is playing in this whole process.
“If N309 billion is injected into the market today, it would only reduce the exposure from N700 billion to N391 billion.
“According to NBET’s August 2016 published electricity market payment report, the bleeding would continue at the rate of N25.6 billion monthly.
“Does this solve the primary bleeding of the electricity market?.
“We in the National Assembly, as representatives of the people who have elected us into office are bound to ask questions.
“We are keen on knowing how and when this Federal Government secured bond would be structured, repayment plan, and repayment source and over what period, “he said. (NAN)