Business Hilights
Tracking Nigeria's Headline Business News Online

Gencos ‘smell rat,’ drag FG to court on allegation of discriminatory practices

Fresh substantive suit, FHC/ABJ/CS/180/2018, between Power generation companies (Gencos) in the country and the federal government is now before Justice Binta Nyako of an Abuja Federal High Court.

The case filed by the companies is seeking reversal of what they described as discriminatory practices against their interest and that of their gas suppliers.

The Gencos specifically named the preferential treatment on Azura Power West Africa Limited and Accugas Limited at their own expense.

Court papers sighted by Business Hilights Abuja Bureau chief revealed that the Gencos alleged that government’s discriminatory practices were taking a toll not only on the Nigerian electricity supply industry but also on the power sector as a whole.

The list of Gencos that were joined as in the suit includes Mainstream Energy Solutions Limited, Transcorp Power Limited, Egbin Power Plc and North-South Power Company Limited.

Listed also as defendants in the suit include the Federal Government; Central Bank of Nigeria; Minister of Power, Works and Housing; the Nigeria Bulk Electricity Trading (NBET) Plc., Azura Power West Africa Limited and Accugas Limited.

On the statement of claims by the litigants, they noted that whereas they continue to make sacrifices by continuing to generate electricity for the national grid without getting payment from the NBET, the defendants had treated and intended to continue to treat them, their investors and suppliers unfairly.

Another factor that forced them to approach the court include “huge indebtedness to banks and financiers, who provided the foreign currency-denominated acquisition loans with which the power plants were acquired from the Federal Government during the privatisation exercise in 2012/13.”

According to Gencos, NBET had consistently defaulted in paying them for the electricity generated and put on the national grid in breach of its contractual obligation which states that “the Gencos would be paid fully (100 per cent) not later than 45 days of invoice submission, and upon delay in payment, be paid with interest at the agreed rate.”

April 16, 2018, had been taken for hearing.