The Senate yesterday queried how the Nigerian Bulk Electricity Trading Plc (NBET) managed to stay afloat in the 2025 fiscal year despite receiving only N60 million out of the N858 billion appropriated for it in the national budget.

The upper chamber, through its Committee on Finance chaired by Senator Sani Musa (Niger East), expressed shock that the critical power sector agency operated the entire year without cash backing for its N858 billion capital vote.

The lawmakers demanded explanations from NBET’s management on how the company survived with what they described as “virtually zero funding,” raising concerns over the implications for Nigeria’s already fragile electricity market.

Presenting the agency’s position, the Acting Managing Director of NBET, Johnson Akinnawo, disclosed the company had relied largely on regulatory income to keep its operations running in the absence of releases from the capital allocation.

He confirmed that only N60 million was released to the agency from the N858 billion appropriated in 2025, leaving a huge funding gap that has further deepened its financial exposure to power generation companies (GenCos).

According to him, the non-release of the capital vote has significantly worsened NBET’s debt profile and constrained its ability to meet obligations within the electricity value chain.

“The gap between generation costs and allowed tariffs is substantial, and without government intervention, the market cannot remain stable,” Akinnawo told the committee.

He explained that NBET’s stabilising role in the power sector has been severely hampered by inadequate funding support, warning that the situation poses serious risks not only to generation companies but also to overall electricity supply across the country.

NBET was established as a bulk trader in the electricity market, purchasing power from GenCos and selling to distribution companies (DisCos), while providing payment guarantees to generation firms.

The arrangement is designed to ensure liquidity and stability in the power sector, particularly in a market plagued by tariff shortfalls and collection inefficiencies.

However, senators noted that without the release of the N858 billion capital allocation, NBET’s capacity to guarantee payments and manage market shortfalls would be significantly undermined.

Members of the committee also sought clarification on whether the agency planned to seek additional capitalization from the federal government to strengthen its operations and address mounting liabilities.

In his response, Akinnawo acknowledged that insufficient capitalization remains a major structural challenge for NBET.

He revealed that the management had formally engaged the Budget Office and the Federal Ministry of Finance over the non-release of the appropriated funds.

He stressed that without urgent and adequate financial intervention, NBET’s ability to perform its mandate as the market stabiliser would remain constrained, with ripple effects on power generation and supply nationwide.

The Senate’s scrutiny comes amid renewed legislative concern over the sustainability of Nigeria’s electricity market, which continues to grapple with liquidity crises, tariff shortfalls and mounting debts owed to generation companies.

Senator Musa, in his remarks, advised NBET to submit a comprehensive proposal detailing its funding requirements and a strategic roadmap for addressing structural bottlenecks in the power sector.

He assured that the committee would carefully review the agency’s submissions as part of its consideration of the 2026 budget proposal, signalling that the National Assembly would intensify oversight to prevent further deterioration in the electricity value chain.

The development underscores the deepening financial strain within Nigeria’s power sector, where agencies saddled with stabilising the market are themselves operating without the full backing of budgeted funds.

With only N60 million released out of an N858 billion allocation, senators said the situation raises fundamental questions about budget implementation, fiscal discipline and the federal government’s commitment to sustaining critical institutions in the power sector.

As the 2026 budget cycle approaches, lawmakers are expected to demand firmer assurances that appropriated funds, especially for agencies central to national infrastructure, are not merely paper provisions but backed with actual releases to avert systemic collapse in key sectors of the economy. (THISDAY)

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