The House of Representatives has stopped the Federal Ministry of Power from using the Nigeria Bulk Electricity Trading Company to raise a Federal Government secured bond of N309 billion.
The bond is to cover a market shortfall of N187 billion naira accrued last year, and N122 billion projected shortfall for 2016. This followed a motion sponsored by Edward Pwajok who expressed worry that the planned massive borrowing would be a great cost to Nigerians.
According to him, the bailout is to the tune of N213 billion through the Nigerian Electricity Sector Intervention (NESI) facility.
“In spite of that intervention, the shortfall, instead of being wiped out, has continued to escalate at the rate of about N15 billion per month (equivalent to N500 million daily).
“It rose to a total-market shortfall of N400 billion as at Dec. 31, 2015.
“A continuing incidence of market shortfall is a distinctive action for new investors to venture into the Nigerian electricity market.
“The implication being that the projected generating capacity expansion is an illustration since any increment in generating capacity will further escalate the market shortfall,’’ he said.