The House of Representatives Committee on Public Accounts has launched a formal investigation into the N632 billion debt owed by the Nigerian Bulk Electricity Trading (NBET) PLC to the Niger Delta Power Holding Company (NDPHC).
Committee Chairman, Rep. Bamidele Salam, has issued a three-week ultimatum to the involved organisations to provide necessary documentation and clarify the circumstances surrounding the unpaid arrears. The probe seeks to determine the reasons for the debt buildup and its overall impact on the nation’s electricity supply chain.
This investigation arrives amid growing concerns regarding the financial sustainability of the Nigerian electricity market, where mounting debts between various stakeholders have frequently led to operational failures and grid instability.
Financial implications for Nigeria’s power sector
The N632 billion debt is a central component of the liquidity crisis currently affecting the Nigerian Electricity Supply Industry (NESI). As the primary off-taker in the sector, NBET is responsible for purchasing electricity from generation companies (GenCos) and reselling it to Distribution Companies (DisCos).
When NBET is unable to meet its payment obligations to generation companies such as NDPHC, it creates a severe cash flow bottleneck. This shortage of funds prevents GenCos from performing essential maintenance on power plants, purchasing fuel, and meeting their own operational costs, which ultimately limits the amount of electricity available to the national grid.
The legislative inquiry into the N632bn NBET debt to NDPHC follows long-standing industry warnings that the current revenue model is unsustainable. Many analysts point to the poor revenue collection capabilities of DisCos as the root cause; when DisCos fail to collect sufficient payments from consumers, the funds do not reach NBET, which in turn leaves GenCos like NDPHC unpaid.
The Public Accounts Committee is tasked with ensuring that government-linked entities manage public funds and obligations with transparency. By targeting this specific debt, the House aims to identify whether there has been administrative negligence or if the crisis is a direct result of the sector’s structural revenue gaps.
NDPHC, which manages several critical power generation assets across the country, relies on timely payments to ensure these facilities remain functional. The inability to settle these debts threatens the long-term stability of the generation segment of the power sector.
The House Committee is expected to summon top executives from both NBET and NDPHC to testify regarding the outstanding billions. The three-week deadline remains the immediate benchmark for the committee to receive the required explanations and documentation.
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