Power: Gencos losing 6,625MW, may sue FG agencies
Power generation companies are losing about 6,625 megawatts of electricity and the firms may sue selected agencies of the Federal Government in the sector over “lots of irregularities” in the industry.
It was further gathered that the 6,625MW of energy was not yielding revenue to the Gencos, despite the fact that they supply a sizable amount of this power to the grid.
Power generators argued that Section 76(1a) of the Electric Power Sector Reform Act stipulated that utilities should be given the opportunity to recover their efficient operating costs and a reasonable return on investment.
But this, according to them, had not been the case, as the market was currently using wheeled energy to work-back the generation capacity of generators and was using same to represent the available capacity, which were aberrations.
They argued that the practice was punitive on Gencos as it discountenanced idle capacity and served as an incentive on non-performance for other sector players such as the Transmission Company of Nigeria and the various distribution companies who represent the associated value chain operators in the delivery of power to end-users across the country.
In a detailed response to an enquiry by our correspondent, the Executive Secretary, Association of Power Generation Companies – an umbrella body for power generators in Nigeria, Joy Ogaji, declared that Gencos were losing over 6,000MW of energy, as they make no revenue from that quantum of power.
Providing a breakdown on how the loss was being incurred, she said, “The technical and operational inefficiencies by these operators (TCN and Discos) negatively impact the Gencos in different ways. With a total available generation capacity of more than 7,500MW and maximum (TCN) wheeling capacity of not more than 5,500MW, there will always be a recurring instance of about 2,000MW idle generation.”
Idle generation represents capital investment not able to yield revenue that will hence impact the ability of the Gencos to support efficient operations and service loans used in developing the power plants.
Ogaji said, “Out of the meagre 5,500MW of transmission wheeling capacity, the Discos have not proven to be able to distribute more than 4,500MW continuously, leaving yet another 1,000MW of generation capacity unutilised. In total, due to the combined technical incapacitation of TCN and the Discos, the Gencos are unable to deploy a total of 3,000MW of capacity that would ensure sustainable and profitable operations.
