Ajaokuta Steel Faces Disconnection Over N25bn Debt, Says NERC

Ajaokuta Steel Faces Disconnection Over N25bn Debt, Says NERC
Ajaokuta Steel

Electricity distribution companies through the Nigerian Electricity Regulatory Commission have warned the Federal Government that failure to settle its electricity bills totalling N25bn may result in its facility, Ajaokuta Steel Co. Ltd,’s disconnection from the national grid.

This was contained in the newly released 2022 NERC’s annual report seen by media source on Monday.

According to the report, the Federal Government, through the Ajaokuta Steel Co. Ltd was owing the power sector a total of about N25bn for electricity supplied in 2022.

As of 31st December 2022, NERC said the firm’s total debt to the Nigerian Bulk Electricity Trading and the Market Operator stood at about N23bn and N2bn respectively making a total of about N25bn.

It stated, “No payment was made by the special customers (Ajaokuta Steel Co. Ltd and the host community) in respect of the N1.39bn and N0.27bn energy invoices and service charges received from NBET and MO respectively. The total debt obligation of Ajaokuta to NBET and the MO as at 31st December 2022 stands at N22.98 billion11 and N2.08bn respectively.”

In a note, NERC explained that the issue of Ajaokuta had been a pressing one for the Commission, adding that engagements had been held with the responsible federal ministries to find a lasting solution to the non-payment of its electricity bills.

“Failure to settle the obligations may put the Ajaokuta complex at the risk of being disconnected by its service providers (NBET and MO) on the grounds of gross indebtedness,” NERC added.

A separate document, NERC’s 2023 Quarter one report also seen by The PUNCH noted that the debt had risen to about N27bn.

The report further highlighted remittance performances of international and bilateral customers to the power sector.

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