07 May 2013, Abuja – Managing Director of the Nigerian Bulk Electricity Trading Company, NBET, Rumundaka Wonodi, says the company would soon be capitalised to the tune of about $550 million by the Federal Government.
According to Wonodi, the capitalisation, expected to happen before the end of this year, is to position the company to effectively carry out its responsibilities as designed in the nation’s emerging electricity market.
He said: “The issue of capitalisation of the bulk trader has about two elements to it. The first is that people look at our market today and say that the bulk trader is coming in to fulfill a role of a credit worthy entity.
“But, when they look at the market, they say there is so much shortfall coming from distribution companies.
“Therefore, if bulk trader is supposed to be in a position to pay for all the power it will receive from the generation companies, it will need additional capital to make up the shortfall and make payment to the generation companies.
“From the bulk trader, that is not what we see. Government is not privatising this whole power sector so that tomorrow the new owners will take over distribution companies and not be able to pay for their power”.
Wonodi explained that the capitalisation was meant to address the gaps in when his company is making payments and receiving payments because, according to him, the company has to make payments to generation companies to give them that confidence, even what there is a shortfall in their collections from the distribution companies.
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