On the issue of Nigeria Electricity, the Minister of Power, Works and Housing, Babatunde Raji Fashola, stated on Thursday that Federal Government is not an obstacle for states developing their own power projects to support development and supply of incremental power. Mr. Fashola announced this during a meeting of the National Council on Power (NACOP) in Jos. He urged both states and local governments to ensure their buildings are properly metered so that they can budget for and pay for the energy they use.
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Excerpt of the statement made by the minister reads:
“I heard statements to the effect that Federal Government should allow the states to develop their own power projects.
“The truth is that Federal Government is not standing in the way of any state; the laws do not stand in the way of any state to develop power projects.
“Because as governor, we built seven power plants, the government did not stop us; what we could not do is to do commercial distribution which the law actually allows under license through Nigerian Electricity Regulatory Commission (NERC).”
Fashola also urged all state governments to wake up to the call of paying Nigeria electricity bills at the state and local government level promptly while ensuring that plans are put in place towards offsetting all verifiable debts owed the electricity distribution companies (DisCos) as soon as possible.
The Minister hailed the Electric Power Sector Reform Act (EPSRA) 2005 whom he described as the best thing ever to have happened to the power sector. He added that the Act also made provisions for investors to make a harmless profit. However, former governor of Lagos expressed regret that it has been discovered that the bulk of the MDAs’ debts being claimed by the DisCos were incurred at the state and local government level.
Speaking further, Fashola continued:
“For example, out of the estimated MDA debts of about N90 billion claimed by the DisCos, only about N27 billion has been verified as debts owed by the FGN.
“There are invoices which show that other parts of the debt are attributable to service points at States and local governments.
“I will urge first that states and local governments insist that their buildings are metered so that they can budget for and pay for energy they use. It will turn out to be cheaper than diesel-generated power and also help reduce loss of income by DisCos.
“Furthermore, I urge state governments to set up small teams with audit capacity to verify debts owed by them and their local governments, ascertain the quantum and develop a payment plan which can then be budgeted for. This will help to reduce the liquidity issues and contribute to the reforms,” he said.
Therefore, Fashola urged state governments to invest more in Nigeria electricity as the law empowers any willing investor, saying “it is only logical and necessary for states and local Governments to own and participate in the implementation of the 2005 Law and the PSRP”.
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