GenCos raise alarm on fuel shortages, mounting debts

Electricity generation companies (GenCos) in Nigeria have raised concerns over a potential deepening of the power crisis.

It was gathered that gas suppliers threaten to halt fuel deliveries to thermal power plants due to mounting unpaid debts.

Joy Ogaji, CEO of the Association of Power Generation Companies (APGC), told Fresh FM that gas producers are increasingly worried about the estimated ₦3.3 trillion owed to them by thermal power plants.

She traced the root of the sector’s financial strain to the inability of Nigerian Bulk Electricity Trading (NBET) Plc to fully settle payments for electricity since the sector’s privatisation in 2013.

Ogaji said the federal government currently owes GenCos about ₦6.8 trillion, with thermal plants accounting for roughly 70% of that total.

The CEO highlighted that the unpaid debts have strained relationships with gas suppliers, who now demand upfront payments before supplying fuel.

She noted, however, that gas suppliers have so far continued to support GenCos, allowing thermal plants to remain operational.

According to her, “for every ₦100 invoiced by thermal plants to NBET, about ₦70 belongs to the gas suppliers.

“The gas suppliers have really been very kind to us. They are the reason why the thermal plants are still generating power. But now, they have told us that if there’s no payment, there will be no gas for the thermal power plants.”

The financial pressure also affects GenCos’ ability to service bank loans and cover operational costs, including plant maintenance.

Analysts say the ongoing debt crisis across generation, distribution, and gas supply remains one of the biggest structural challenges facing Nigeria’s electricity sector, with the potential for further disruptions if urgent intervention is not taken.