‘It’s hindering operations’ — NDPHC MD laments N600bn debt by NBET, companies

The Niger Delta Power Holding Company (NDPHC) says it is being owed about N600 billion by the Nigeria Bulk Electricity Trading (NBET) Plc and other bilateral entities.

Jennifer Adighije, managing director of NDPHC, in a statement on Sunday, said the debt is taking a toll on the operations of the power holding company.

She lamented the limited uptake of electricity from the market, which she said continues to weigh down operations.

“Gas supply challenges, transmission constraints as well as close to N600 billion debt being owed the company by Nigeria Bulk Electricity Trading (NBET) and other bilateral entities are hindering the company’s operations,” Adighije said.

The managing director said the new management has been proactive, restoring five turbine units at Calabar, Omotosho, Sapele, and Ihovbor plants.

She said the units, previously offline, now contribute an additional 625 megawatts (MW) to the national grid.

“NDPHC currently has mechanically available generation capacity of about 2,000MW that is significantly stranded due to transmission constraints, gas supply and gas transportation limitations in addition to dwindling offtake by the distribution companies (DisCos),” Adighije said.

Over the years, according to the NDPHC,the “NIPP plants are utilised by the system operator to carry out primary frequency response, enabling power grid stability”.

“These ancillary services ought to be monetized in line with the grid code and industry regulations. However, NIPP plants are ordered to startup and shut down at the prerogative of the system operator without any form of compensation thus leading to low utilization of capacity and operational stress on the generating turbine units,” she said.

“As you know, in accordance with the grid code, we are placed on restrictions for a number of reasons, from inadequate transmission grid availability – although this is being seriously addressed by the Honourable Minister of Power, Chief Bayo Adelabu – to low demand from the downstream electricity market.

“It is important to note that power generation is driven by demand, and therefore, if the demand isn’t made, the plants will not generate.

“In certain cases when the demand arises, there is inadequate dispatch corridor or wheeling capacity through the grid network.”

In spite of these limitations, she said the NDPHC continues to spearhead “transmission grid expansion plan and distribution network interventions to enable power generation to be delivered to the last mile underserved communities”.

‘NDPHC HAS INVESTED OVER N500BN IN TRANSMISSION PROJECTS’

Since the inception of the national integrated power projects (NIPP), the NDPHC boss said the company has invested over N500 billion in transmission projects.

The projects, she said, include transformers, transmission substations, switch gears, switch yards, transmission lines, line bay extensions, and “several world-class projects currently being operated by the TCN“.

On the Alaoji power plant, Adighije noted that gas supply metering disputes led to its shutdown.

Adighije, however, assured stakeholders of its functionality before year-end, noting that significant progress has been made to restore the gas metering station.

She said the company had made several attempts (to no avail) to enter into a power purchase agreement (PPA) with the NBET, which would have improved the NDPHC’s merit order in the dispatch priority schedule.

“This has impacted the company very negatively financially and further exacerbates the stranded capacity of the company,” the NDPHC boss said.

“Currently, NDPHC is placed in the least priority bucket for dispatch in spite of its available daily dispatch capacity of about 2,000MW.

“By no small measure, NDPHC remains the largest fleet of generating turbine units in the sector, conversely, much of that capacity remains stranded due to these impediments that constrain the company from generating optimally.”

Adighije said the company was leveraging the order issued by the Nigerian Electricity Regulatory Commission (NERC) on bilateral agreements to sell its stranded power and should soon conclude some deals with off-takers.

The managing director explained that the company currently has a generation capacity in excess of demand from the national grid, and is, therefore, prioritising direct supply to bilateral and eligible customers to commercialise its stranded capacity.

She also said the strategy of the new management seeks to unlock the stranded energy by dedicating significant portions of it to eligible customers and bilateral trading arrangements.

This, the NDPHC boss said, is pursuant to the July 25 order of the NERC “directing generation companies now to trade bilaterally with eligible customers and that should be able to address our stranded capacity”.