CBN suspends N213bn loan to Discos, Gencos
The Central Bank of Nigeria has suspended until further notice its disbursement of N213 billion in bailout funds to the electricity generation companies (Gencos) and distribution companies (Discos).
The Governor of the Central Bank of Nigeria (CBN) said this yesterday in Lima, Peru, while addressing newsmen on the general issues affecting the Nigerian economy.
“Not all funds have been disbursed to the electricity companies because of the issues we need to trash out with the Nigeria Electricity Regulatory Commission (NERC) and the Nigeria Bulk Electricity Commission (NBEC),” he told journalists.
According to the Governor, the bailout fund, which was meant for the upgrade of electricity equipment and replacement, has been of great help for beneficiaries but some things needed to be resolved before the bank continues to release the funds.
About N58bn out of the total N213bn has so far been disbursed to some Discos and Gencos. The loan has a repayment spread of 10 years, at 10 per cent interest rate.
The Governor also said more intervention is likely in the transmission network to complement the generation effort of the electricity companies.
“We have seen some improvement in the power generation and it is also true that the wheeling capacity of the transmission grid is also limited. I am also aware that we have been in discussion with government about the effort that is being made to improve the transmission grid.
“The Discos are meant to use the money to buy meters and transformers in order to improve their capacity, while the Gencos will acquire equipment to replace some of their obsolete ones so that they can also improve on their capacity. We have started to see improvement on that. We believe that by the time the remaining funds are disbursed, we will witness more progress.” the CBN chief said.
The first beneficiaries of the special CBN power sector intervention facility included the Eko Electricity Distribution Company Plc and Ibadan Electricity Distribution Company Plc, which received cheques valued at N5.16bn and N11.36bn respectively.
Others are the Jebba Hydroelectric Plc, Kainji Hydroelectric Plc and Shiroro Hydroelectric Plc, which also received the sums of N816.83m, N234.81m and N678.650m respectively, totalling N18.26bn.
Six more companies benefited from the second round of the disbursement in various sums. They were the Enugu, Ibadan and Kano Electricity distribution companies, as well as the Ughelli, Egbin and Geregu Electricity generation companies. The total for the second batch was N39.53bn.