The distribution companies are the sole source of revenue for the PHCN, even as the minister threatened to seek presidential approval to deduct debts at source from ministries’ votes.
“I will brief the president on decisions you arrived at the retreat, and if there is any need to start deducting money at source from the votes to ministries, departments and agencies in order to strengthen the power sector, which is very dear to him, the president will certainly not hesitate to do so,” Nnaji said.
The emergency meeting, according to sources in the ministry, “is to help create a paradigm shift because Nnaji believes we cannot continue with a system, which has failed over the decades and still expect a different result.”
The meeting, mandatory for chief executives and marketing chiefs of the distribution companies, held at Oriental Hotel, Lagos, this weekend, with officials of the Presidential Task Force on Power in attendance.
It was gathered that the monthly PHCN revenue, which was N11.8billion when Nnaji assumed office last July, rose to N15.6billion in December, but declined to N12.8billion in January, following the general strike against the removal of petrol subsidy. However, unconfirmed reports suggested it was N14.9billion last month.
At an unscheduled meeting in his office last week with top ministry and PHCN executives responsible for revenue mobilisation, ahead of the Lagos meeting, the minister directed the officials to work out strategies “that will result in a monthly revenue of at least N22.5billion, the irreducible minimum which we must generate to ensure regular settlement of PHCN’s obligations to power and gas suppliers like Shell, Agip and AES.”
PHCN indebtedness
The PHCN allegedly owes various companies huge amounts of money:
* Agip N60billion for its power plant at Okpai in Delta State, which produces 470Megawatts;
* Shell $78million for its 561MW from Afam in the Rivers State
* Nigerian Gas Company N10billion for 700million standard cubic of natural gas
* National Integrated Power Project N6billion for power supplied from its stations in Sapele in Delta State and Olorunsogo in Ogun State
* Ibom Power N300million for the 90MW generated from its plant at Ikot Abasi in Akwa Ibom State.
As a result, Nnaji noted, “Even when we generate N22.5billion monthly, it will still not be big enough for our maintenance and operations, but enough for only the payment of gas and power supplies, as well as for the wage bill which has ballooned since we last June approved a 50% increase in salary as part of the incentive package for the entire 50,000workforce.”
The minister also directed the executives to search for “new and creative ways to recover the N100billion owed PHCN by customers across the country,” dispelling the notion that the government debt is the cause of the debt crisis.
“What the government and all its agencies in the country owe is about only 20% of the debt stock. Therefore, there must be a paradigm shift in the way we have been going about our revenue business, including the deployment of modern technology,” he declared.
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Solidstonez
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