LIQUIDITY: Gencos Set To Shut Down Power Plants

Power generation companies (Gencos) in Nigeria have said they will be forced to shut down their power plants if the challenges facing them are not addressed.

The Association of Power Generation Companies, the umbrella body for the Gencos, said on Monday that the recent decline in available generation capability could be traced to the various challenges experienced by the Gencos in the electricity market.

The Executive Secretary, APGC, Dr Joy Ogaji, said in a statement that the challenges included liquidity issues, power rejection by the electricity distribution companies and gas constraints due to the sorry state of the market.

Ogaji said, “Few of the thermal power plants were out due to planned maintenance, which is allowed in the sector. The decline was not an act of rebellion by the Gencos neither was it deliberate but was beyond their control.

“This should serve as a wake-up call to the Federal Government to the goings-on in the industry with regards to the Gencos and if the actions are not taken by the necessary agencies, Gencos will be forced to shut down business.”

According to the data made available to our correspondent by the association, available generation capability plunged to 5,207.57 megawatts in December from 7,238.12MW in November, while average generation rose slightly to 4,162.47MW from 4,093.76MW

Ogaji said, “Available generation capability experienced a drop due to various factors such as gas constraints, ongoing maintenance by some gas suppliers and low load demand by distribution companies, which resulted in reduced generation or outage of some power plants.

“Afam Power Plc (Afam VI Gas/Steam), GT12, 13 and ST10 power plants were shut down for a period of about 16 days due to planned maintenance that was carried out by the gas suppliers on their facilities. Although Afam Power Plc was duly notified about the maintenance, it resulted in a reduction of Afam’s available generation capability from about 490MW to zero.”

She said within the period, most of the plants built under the National Integrated Power Project, including Alaoji, Sapele, Olorunsogo, and Omotosho, suffered from gas constraints.

“Some of the companies’ generation capability dropped to zero due to the outage of their power plants which was as a result of gas constraints,” Ogaji said, adding that gas supply to Alaoji NIPP was cut off by the gas suppliers due to the firm’s inability to pay for gas.

According to her, Jebba Power Station’s generation capability reduced by about 110MW to 360MW due to low load demand,

She said the reduction in demand by Discos also affected Egbin and Omoku power plants.