The Federal Government has pledged to sell off the five electricity Distribution Companies (DisCos) amidst persistent blackouts. The government also revoked a $200 million non-performing metering contract awarded in 2021. Minister of Power Adebayo Adelabu stated that banks and Asset Management Company (AMCON) lacked the technical capacity to manage these DisCos. The sale to reputable technical power operators is expected to be completed within three months.
Affected DisCos include Abuja Electricity Distribution Company (AEDC) under United Bank of Africa (UBA), Benin Electricity Distribution Company (BEDC), Kaduna Electricity Distribution Company, and Kano Electricity Distribution Company under Fidelity Bank. Ibadan Electricity Distribution Company (IEDC) is under AMCON management. Investors hold 60% of shares in the DisCos, while the Federal Government holds the remaining 40%.
Adelabu emphasized the need for expert management of energy distribution assets and tough decisions on DisCos, stating that the entire Nigerian Electricity Supply Industry (NESI) fails when they refuse to perform. He highlighted the necessity of reorganizing DisCos for efficiency, noting that Ibadan DisCo is too large for one company to manage.
The decision to resell the DisCos was met with concerns from some committee members, including Senator Isah Jibrin, who alleged asset stripping by some operators. Adelabu also addressed the issue of a non-delivered metering contract and announced plans to bridge the current eight million metering gap in the next four to five years, with funding from the Nigerian Sovereign Investment Authority (NSIA).
At the Transmission Company of Nigeria (TCN), Managing Director Sule Abdulaziz sought the committee's assistance in raising funds for over 120 projects and addressing right of way issues. He highlighted the challenge of vandalization and the need for funding for new substations. Independent System Operator (ISO) Executive Director Nafisat Ali identified gas shortage as a major constraint in the industry, with DisCos still rejecting load despite power shortage.
The Federal Government has announced its intention to sell the five electricity Distribution Companies (DisCos) amidst ongoing power outages. This decision follows the revocation of a $200 million non-performing metering contract awarded in 2021. Minister of Power Adebayo Adelabu criticized the lack of technical capacity among banks and the Asset Management Company (AMCON), which have been managing these DisCos due to their failure to repay loans.
The sale process to reputable technical power operators is expected to be completed within three months. The affected DisCos include Abuja Electricity Distribution Company (AEDC) under United Bank of Africa (UBA), Benin Electricity Distribution Company (BEDC), Kaduna Electricity Distribution Company, and Kano Electricity Distribution Company managed by Fidelity Bank. Ibadan Electricity Distribution Company (IEDC) is under AMCON management. Currently, investors hold 60% of shares in the DisCos, while the Federal Government holds the remaining 40%.
Adelabu emphasized the importance of expert management for energy distribution assets and highlighted the necessity of making tough decisions regarding the DisCos, as the entire Nigerian Electricity Supply Industry (NESI) is impacted when they underperform. He also stressed the need to reorganize DisCos for better efficiency, noting that Ibadan DisCo is too large for a single company to manage effectively.
The decision to resell the DisCos was met with concern from some committee members, including Senator Isah Jibrin, who alleged that some operators had stripped the assets of the DisCos they took over in 2013. Adelabu also addressed the issue of a non-delivered metering contract and announced plans to bridge the current eight million metering gap over the next four to five years, with funding from the Nigerian Sovereign Investment Authority (NSIA).
At the Transmission Company of Nigeria (TCN), Managing Director Sule Abdulaziz called on the committee to assist in raising funds for over 120 projects and addressing right of way issues. He highlighted the challenge of vandalization and the need for funding for new substations. Independent System Operator (ISO) Executive Director Nafisat Ali identified gas shortage as a major constraint in the industry, with DisCos still rejecting load despite the power shortage.
