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Thursday, June 24, 2021
Home Midstream Gas/Power NDPHC decries impact of unpaid N193bn debt on operations

NDPHC decries impact of unpaid N193bn debt on operations

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.Says only 800MW out of over 3000MW capacity from 10 plants is dispatched 800MW due to load rejection by Discos.

The Chief Executive Officer, Niger Delta Power Holding Company (NDPHC), Mr Chiedu Ugbo, has lamented before the Senate and House of Representatives committee on Power, how N192,992,895,429 owed the company for electricity generated from its 10 power plants to the grid impacted negatively on the operations.

Ugbo, speaking before the committee on Tuesday, said the overarching challenge for NDPHC is the low market remittance leading to huge indebtedness, stressing that as at May 31st, 2020, over N190billion Naira was owed to the company for electricity generated from its power plants to the National grid.
He gave the breakdown of the indebtedness to include Legacy Debt Period: 2011 – 2013, N24,488,365,072, Interim Rule Period: 2013 – 2015, N6,796,473,564, TEM (NBET): 2015 – 2020, N312,386.741.364, totaling N312,386,741.364.
He said with less Payment to Gas Suppliers & PAF of N119,393.845,935, the total money owed the company amounts to N192,992,895,429.
Ugbo noted that NDPHC operations are being constraints by transmission, distribution and gas adding that
NDPHCs available capacity as at today is over 3000MW but it can only dispatched 800MW and below by the System Operator(SO) because of load rejection by Discos.
“Inadequate dispatch grossly affects NDPHCs revenue generation capacity, Irregular Dispatch (Disco Load Rejection), Irregular Dispatch and the SOs reoccurring instruction to start-up & shut down the units due to load rejection issues causing increased maintenance cost of the units”, he stated
On gas Gas constraints, Ugbo explained that three Power plants on the eastern axis of the Niger Delta have full gas but constrained by dispatch challenges while five Power plants on the Western axis of the Niger Delta have major insufficient gas supply. As at today, gas requirement is 560 mmscf/day while 60 mmscf/day is available. Negotiating additional 50 mmscf/day with Seplat
He said the company is faced with low revenue generation due to poor dispatch, low remittance from the market (NBET), emphasis ing that the last collection as at March 2020 was 11.2% of invoiced energy.
Ugbo also lamented high cost of maintenance due high frequency of system shut down and start up,
Shortage of spares due to paucity of funds to stock spares as well as inability to execute gas contract with Take or Pay (ToP)/security
He noted that NDPHC is on low tariff compared with other thermal stations.
He said: “NDPHC’s tariff is fixed at N18.4 per KWh as against N24 per KWh for by other IPPs while payment for ancillary services is yet to be determined and commenced.
The Managing Director also called the attention of the committee to the uncertainty of exchange rate, emphasising that gas is being paid for at N306/USD$ whereas the market rate is at N360/USD$.
Difference, he said, has been a cause for dispute with indigenous gas suppliers.

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