GENCOs in Nigeria - Key limiting factors slowing down peak performance


Thursday, November 05, 2015 5.10 AM / News Release

Transcorp Ughelli Power Plc (Transcorp Power) today detailed the key issues affecting the ability of most Generating Companies (GENCOs) to operate at peak levels and increase available capacity.

The issues they highlighted are as follows:

Since privatization there has been delayed, and sometimes partial payment for the electricity generated. This has led to the industry owing Transcorp Power about N25 billion. Other GENCOS are also owed.

In the lack of a cost reflective tariff that would most ideally generate revenue for the power generated, as tariff of generating companies have not been reviewed since May 2014 despite the major cost component that drives the tariff such as forex rate, inflation and Gas prices has increased significantly since the last review.

Lack of predictability as the activation of contractual agreements such as the Power Purchase Agreement which is a key ingredient of the TEM are yet to be effected, thereby creating uncertainty in the market in relation to cashflow planning and investments

NCC/3rd Parties:
About 35 - 40% of available capacity of the plant has been lost in the current year as a result of 3rd parties actions such as gas outages /quality and incessant instructions from the National Control Centre to reduce load due to inability of transmission to wheel the power.

NCC has begun issuing regular directives to GENCOs and DISCOs decreasing the amount of power that is generated and sent out. Last quarter when lack of gas supply meant that, Transcorp Power had available 650MW, NCC rejected more than half of that; and DISCOs were ordered to go as low as 200MW.

Related News
1.       Power sector in need of coordinated direction – Aug 21, 2015
2.      Power: Nigeria's Bulk Trader Concludes PPA ... – May 18, 2015
3.      A growing squeeze on the GENCOs – Jan 15, 2015
4.      GENCO Privatisation Arrangements Completed – Aug 21, 2014
5.      Where Are The DISCOs And GENCOs? – Aug 14, 2014
6.      GENCO Privatisation Arrangements Completed -



Related News