The Federal Government on Tuesday endowed N50bn in escrow accounts of three Nigerian banks to support the efforts of power generation companies.
According to Director-General, Bureau of Public Enterprises, Mr. Benjamin Dikki, the money would be a buffer for losses that the GenCos could suffer in the process of power transmission. Dikki who signed the agreement with the three banks said United Bank for Africa and First Bank of Nigeria Limited would participate in the process for the release of the funds deposited in their escrow accounts with First City Monument Bank serving as the lead escrow agent.
He further explained that the fund which is an incentive to the power plants’ owners to invest in expanding the capacity generation of the nation would be managed by the Electricity Bulk Trader while the generation companies must meet certain conditions before they could withdraw from the
“This N50bn is not a dash. There are certain conditions that must be met before funds can be drawn from these escrow accounts. The market and systems operator must confirm the quantum of power put on the national grid. The market operator has to confirm that because of system defects and inefficiencies in the transmission network, certain amount of power was lost. So, there has to be a due process before any GenCo can draw from this amount. It is not a gift because certain conditions have to be met.”