Th e federal government’s reluctance to pay off its debt to generation companies is hurting their plans to strengthen its facilities through expansion of projects. Accordingly, the GENCOs, which have repeatedly come under fire for underperform have cried out in demand of payment of the huge debt.
The GENCOs, which put the debt owed them by the federal government at about N500 billion, further accused the government of making it diffi cult for them to obtain required foreign exchange to make necessary purchases. They said their request to the Central Bank of Nigeria (CBN) for friendly forex purchase hurdle so that they could buy spare parts for repairs have not been met by the apex bank.
A c c o r d i n g l y, t h e y s a i d government’s forex policy was inimical to their businesses as it does not scare away potential investors, but preventing them from expanding its facilities for service delivery. According to the Executive Secretary of the Association of Power Generation Companies (APGC), Dr. Joy Ogaji, this has not only frustrated their expansion programme but further imposed fi nancial hardship on them.
She said most GENCOs are under able to meet basic fi nancial demands making it impossible for them to operate optimally as they would have loved to. Ogaji noted that the huge debts in the books of the Gencos have become major setbacks to their capacity expansion plans, adding that while their lenders frequently write to them on this, investors have also stayed away from advancing negotiations on fi nancing future capacity expansions
