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Tag: DISCOS

  • FG to revoke licences of underperforming DisCos in 2028

    FG to revoke licences of underperforming DisCos in 2028

    The Minister of Power, Chief Adebayo Adelabu, has said the Federal Government will not renew the licences of electricity distribution companies (DisCos) that fail to meet performance standards when their current licences expire in 2028.

    Adelabu issued the warning at the 2025 Nigerian Economic Summit in Abuja during a session on the power sector, where he identified the inefficiency of the DisCos as one of the major challenges preventing a stable electricity supply in the country.

    The session, with the theme: “Uninterrupted power supply: The Industrial Imperatives,” attracted key industry stakeholders to discuss solutions to Nigeria’s enduring electricity problems.

    According to the minister, while the power sector is burdened by structural issues, the poor performance of the DisCos continues to impede progress toward achieving reliable and sustainable power delivery.

    He said: “The distribution companies need to sit up. They are a major bottleneck in the sector, and the government is doing everything possible to ensure they meet expectations. Their licences will expire in two years, and there will be major reforms before any renewal.

    Read Also: DisCos records 20MW supply as GenCo trips

    “Those that have not demonstrated technical expertise, financial stability, or commitment to national interest will be replaced. The government will ensure that every household is metered within the next three to five years.”

    On efforts to resolve the liquidity crisis in the sector, Adelabu disclosed that President Bola Tinubu has approved a N4 trillion bond to offset verified debts owed to power generation companies (GenCos) and gas suppliers.

    “To stabilize the market, Mr. President has approved a N4 trillion bond to clear verified GenCo and gas supply debts. Alongside this, a targeted subsidy framework is being developed to protect vulnerable households and ensure the sector’s long-term viability,” he said.

    Chief Executive Officer of Azura Power, Mr. Edu Okeke, and the Managing Director of Nigeria LNG Limited, Mr. Philip Mshelbila, called for improved liquidity and efficient gas pricing to attract investment in power generation.

    Okeke noted that payment concerns over gas being priced in dollars were minor compared to other structural challenges facing the industry, while Mshelbila stressed that appropriate pricing would help stimulate investment in gas supply for electricity generation.

  • DisCos records 20MW supply as GenCo trips

    DisCos records 20MW supply as GenCo trips

    Ten electricity Distribution Companies (DisCos) on Wednesday received 0MW, while the Abuja Electricity Distribution Company (AEDC) got 20MW supply from the Nigerian Independent System Operator (NISO) at 11:54 am, owing to a grid collapse following a tripped Generation Company (GenCo).

    On its own, the AEDC notified its customers that the outage was due to a loss of supply from the national grid.

    Owing to the restoration process, Ibadan Electricity Distribution Company (IBDC) later received 40MW from the NISO.

    Although the NISO in a press statement described the situation as a grid disturbance from a tripped GenCo, it was silent on the name of the particular plant.

    Read Also: BPE to list two DisCos, GenCo on stock exchange

    The press statement reads in part, “The Nigerian Independent System Operator (NISO) informs the general public that the national grid experienced a system disturbance at 11:20 hrs on

    10/09/2025.

    “The disturbance was caused by the tripping of a GenCo, resulting in a significant load drop, which cascaded to other GenCos, leading to a system disturbance.

    “NISO immediately commenced restoration of the grid at 11:45 hrs, beginning with supply to Abuja from the Shiroro power plant, and substantial restoration has been achieved across the country. A full investigation into the immediate and remote causes is underway.

    “The outcome (s) of the investigation report would determine the remedial and proactive actions to be taken to forestall future occurrences. We crave your indulgence to bear with us as restoration is still ongoing.”

  • BPE to list two DisCos, GenCo on Stock Exchange

    BPE to list two DisCos, GenCo on Stock Exchange

    • FMBN, FHA, Film Corporation, others for commercialisation

    The Federal Government is concluding arrangements to list two electricity distribution companies (DisCos) and one generation company (GenCo) on the Nigerian Exchange (NGX).

    Director General, Bureau of Public Enterprises (BPE), Mr. Ayodeji Gbeleyi, at his maiden media briefing yesterday in Abuja said the government was considering unbundling its equity stakes in two DisCos and a GenCo in first phase of transactions aimed at unlocking values and enhancing operating efficiency of national assets and state-owned enterprises.

    Gbeleyi, who was appointed by President Bola Tinubu mid 2024, said the unbundling would be done by offering part of government’s residual equity stakes in the three power companies to the investing public through initial public offerings (IPOs).

    He said the transactions would involve part of 40 per cent equity stake and 30 per cent equity stake jointly owned by federal and state governments in the DisCos and GenCo respectively.

    He however did not provide further details on the identities, timelines, values and proportions of the offers citing “sensitivity of the matter” and the need to protect the integrity of the transactions and avoid unnecessary anxieties among stakeholders.

    READ ALSO: Your governor has your money, ask him for it

    He noted that the listing of the three power firms would allow Nigerians to participate in the ownership of critical power infrastructure, while helping to strengthen corporate governance and transparency in the power sector.

    “We intend to drive shared prosperity and inclusiveness by listing part of the FGN-States’ 40 per cent/30 per cent residual shares in certain Discos and a Genco on the stock exchange,” Gbeleyi said.

    Market analysts yesterday said the transactions could unlock more than N2 trillion based on the average valuations of similar assets listed on the stock market.

    Two GenCos are already listed on the NGX. Transcorp Power Plc, owned largely by Tony Elumelu-led Transnational Corporation of Nigeria (Transcorp Group), closed yesterday with total market value of N2.15 trillion.  Geregu Power Plc, owned mainly by Lagos billionaire businessman, Mr. Femi Otedola, was valued yesterday at N2.85 trillion.

    There are 11 DisCos including Abuja Electricity Distribution Company (AEDC), Benin Electricity Distribution Company (BEDC), Eko Electricity Distribution Company (EKEDC), Enugu Electricity Distribution Company (EEDC), Ibadan Electricity Distribution Company (IBEDC), Ikeja Electricity Distribution Company (IKEDC), Jos Electricity Distribution Company (JEDC), Kaduna Electricity Distribution Company (KAEDCO), Kano Electricity Distribution Company (KEDCO), Port Harcourt Electricity Distribution Company (PHEDC), and Yola Electricity Distribution Company (YEDC).

    In the Nigerian Electricity Supply Industry (NESI), there are some 23 power generating plants connected to the national grid, although in most cases, as many as five could be put off operation owing to several constraints such as gas, transmission, vandalism and illiquidity in the sector.

    The most prominent GenCos included Egbin Power Plc, Shiroro Power Plc, Kainji/Jebba Power Plc, Transcorp Power Plc, Geregu Power Plc, Sapele Power Plc, Geregu Power Plc, Dadinkowa  and Azura-Edo among others.

    Ikeja Electricity Distribution Company (Ikeja Electric), which has successfully optimised a functional corporate system, is Nigeria’s largest DisCos while the Ikorodu, Lagos-based Egbin Power Plc is the largest GenCo with installed capacity of 1,320 MW consisting of six units of 220MW each.

    Gbeleyi said BPE is also working on broader economic diversification through partial or full commercialisation of key agencies such as the National Parks Service, Nigeria Film Corporation, Federal Mortgage Bank of Nigeria (FMBN), and the Federal Housing Authority (FHA).

    He added that there are ongoing engagements for the concession of five airports and the optimisation of Baro Inland Port in collaboration with the Ministry of Marine and Blue Economy and National Inland Waterways Authority (NIWA).

    He said the BPE was committed to exploring financial and ownership models that will block the leakages in the government’s refineries.

    Although he did not go into detail on the refineries, he confirmed they fall among the major state-owned enterprises “yet to see action,” while indicating that plans are underway to “concession refineries, storage, and pipeline facilities” in the oil and gas sector.

    He said the overall focus of BPE remains creating a more efficient and competitive public enterprise landscape.

    “For us at the BPE, we have indeed set sail on re-engineering the reform and privatisation of public enterprises, one transaction at a time,” Gbeleyi said.

    Since established in 1999 as the Secretariat of the National Council on Privatisation under the Public Enterprises Act, BPE has completed 243 transactions. Of these, 109 public entities have been either fully or partially privatised or commercialized, while 91 remain untouched, including Nigeria’s refineries, airports, railways, and steel complexes.

    Gbeleyi said the BPE had faced delay in concluding many transactions due several challenges including lack of a clear and predictable legal framework for Public-Private Partnerships (PPP), resistance to reforms by some MDAs, inadequate funding, and legacy transaction-related litigation

    He said BPE was working with the Ministry of Budget and Economic Planning and other stakeholders to build a strong pipeline of catalytic PPP projects.

    He pointed out that as part of the Renewed Hope Agenda, BPE is fast-tracking key energy-related projects, including the Distribution Sector Recovery Programme (DISREP), Afam III Fast Power, Makurdi Hydropower Plant, and reforms in the mining sector.

    He stressed that BPE’s broader strategy was to support President Tinubu’s Renewed Hope Agenda by unlocking value from public assets, driving private investment, and accelerating job creation.

    Gbeleyi said the Bureau is targeting N312.3 billion in revenue for 2025 through 15 strategic transactions, including six revenue-generating and nine reform-based projects.

    According to him, so far in 2025, BPE has raised N170.74 billion, including successful concession of the Zungeru Hydropower Plant at about N101.5 billion and the Afam III Fast Power project at about N53.92 billion.

    Gbeleyi defended the overall impact of privatisation on Nigeria’s economy, citing gains in key sectors such as telecommunications, maritime, pensions, and power.

    He pointed to Nigeria’s telecom revolution, which has grown from 400,000 active lines under NITEL to over 169 million subscribers today, with the sector contributing 14.4 per cent to Gross Domestic Product (GDP).

    In the pensions sector, reforms have boosted Assets Under Management to N24.63 trillion as of June 2025, with more than 10.7 million Retirement Savings Accounts registered. In the ports, private terminal operations have cut cargo dwell times from 30 days to 7–14 days and attracted billions in investment since the 2006 port concessions.

    He recalled that the unbundling of the Transmission Company of Nigeria (TCN) led to the creation of Nigerian Independent System Operator (NISO) to promote market independence and efficiency.

    On metering, he said from the 403,255 meters recorded in 2013, the industry as at 31st March 2025 has 6,468,036 meter installation to boot.

    Giving the breakdown, he said 3.2 million meters came from the $500million Distribution Sector Recovery Program (DISREP) Program while 2.5 million meters were from the Presidential Metering Initiative.

    Gbeleyi said the debate has gone beyond whether to privatize the national refineries as the sales, commercialization and privatization are based on financial models.

    He expressed commitment to working towards the realisation of the $1 trillion renewed hope economy.

    He said the BPE is working to deliver 50 million jobs in line with the renewed hope agenda.

  • BPE to list two DisCos, GenCo on stock exchange

    BPE to list two DisCos, GenCo on stock exchange

    …to disburse shareholders loan to DisCos any moment

    The Bureau of Public Enterprises (BPE) is set to list two electricity Distribution Companies (DisCos) and one generation company (GenCo) for the Initial Public Offer (IPO) in the Nigeria Stock Exchange market.

    The Director General, Mr. Ayodeji Gbeleyi broke the news in media briefing in Abuja on Tuesday.

    He, however, refused to disclose the names of the companies for the purpose of corporate confidentiality.

    He also revealed that shareholders loan agreements were recently executed for 10 out of the 11 DisCos.

    According to him, the disbursement of the loan would begin any moment soon.

    Responding to the privatization of five GenCos, he said the transaction has been kept in abeyance because exchange rate volatility and other factors.

    He said the GenCos have not key into the eligible customer regulation because of transmission challenges.

    He said BPE is open to support any advice or policy that will stop the national refineries from financial leakages and bleeding.

    Gbeleyi said the debate has gone beyond whether to privatize the refinery.

  • Discos’ revenue dips to N182.11b

    Discos’ revenue dips to N182.11b

    • CPPE: it’s a risk on utilities’ sustainability

    The financial strain on electricity distribution companies (DisCos) may not abate anytime soon. This is because collection of bills, a core source of their revenue, has continued to dip.

    According to the latest report on Discos revenue collection released by the Nigerian Electricity Commission (NERC) for the month of June 2025, DisCos recorded a drop in their revenue collection for the month of June 2025, as their total intake dropped to N182.11 billion, representing a 4.93 per cent intake from the N191.57 billion recorded in May.

    The figures, contained in NERC’s Commercial Performance of Distribution Companies Factsheet for June 2025, revealed that while DisCos billed customers N237.85 billion for energy consumed, only 76.57 percent of the billed amount was actually collected. This marked a slight improvement compared to the 73.17 percent collection efficiency recorded in May.

    Eko DisCo emerged the top performer, raking in N33.18 billion, followed closely by Ikeja Electric with N32.66 billion, and Abuja DisCo with N30.11 billion. On the contrary, Yola DisCo collected N2.96 billion, Kaduna Electric managed N3.62 billion, while Jos DisCo raked in N5.71 billion, to emerge as the lowest revenue performing utilities.

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    The declining revenue collections by Discos is not unconnected with the lingering challenges in the country’s power sector, including poor service delivery and the hydra-headed problems associated with consumer metering.

    Chief Executive, Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, noted that the declining revenue collection by Discos poses a big risk to their operational health and sustainability. This malaise, he argued, may lead to illiquidity of the utilities.

    “There are huge commercial losses arising from massive electricity theft and general indiscipline regarding payment for electricity consumed. Regrettably government agencies are some of the major culprits.  Unpaid electricity bills by these agencies runs into several billions of naira.

    “Then there is the issue of tariffs  which the Discos have argued are not cost reflective.  Social and political considerations have been impeding the introduction of cost reflective tariffs.  All of these have combined to create an incredible sustainability challenge for the Discos and the entire power sector,” the CPPE boss said.

    According to Yusuf, several factors are responsible for the unhealthy situation which the utilities have found themselves. One of these he noted to be that investments made were based on assumptions which have turned out to be unrealistic.

    “The biggest risk to the health and sustainability of the DISCOS is illiquidity which is fast degenerating to insolvency.  First the investments were based on assumptions which turned out to be unrealistic.  Most of those assumptions have collapsed in the course of time.

    “Besides, the risks of the business were not properly evaluated from the outset, some of which have now crystallised, creating major challenges for the companies. Political and macroeconomic  risks were very significant.

    “There was also the case of weak technical capacity and knowledge of the investors about the power sector.  The knowledge and capacity gaps was a major challenge because many of the investors have very little knowledge about the power sector. It is not easy to manage an industry you do not understand,” he explained.

    Yusuf noted that there were also concerns about the transparency of the privatisation process as the debt financing component of the acquisition was very high. “Many of the Discos were heavily leveraged because the debt financing component of their acquisition was high. Subsequently, with a huge debt service burden in a high interest rate environment, it became a nightmare for the companies,” he explained, adding that “it has become inevitable for the government to do some heavy lifting to pave the way for the emergence of a power sector that can support the economic and social objectives of the government.”

    Similarly, the Chairman of the Electricity Consumers Association of Nigeria, James Chijoke, criticized the DisCos for failing to provide value to customers. He argued that the majority of electricity users are still unmetered, forcing them to pay for power they did not consume under the guise of estimated billing system.

    “With over half of customers not metered in the sector, most are paying for services they did not receive. Estimated billing means customers continue to pay high rates for electricity whether there is supply or not. It is an unfair practice that must be urgently stamped out by the government,” Chijoke said.

  • 11 DisCos owe Fed. Govt N2.7tr

    11 DisCos owe Fed. Govt N2.7tr

    Eleven Electricity Distribution Companies (DisCos) owe the Federal Government  N2, 702,485 436,151.19, the Nigerian Bulk Electricity Trading Company (NBET) Plc has revealed.

    The sum, according to a document submitted by  NBET to the House of Representatives Committee on Public Accounts, ought to be remitted to the federation account.

    The DisCos are also said to have under-remitted  N166 billion, a sum below the Nigerian Electricity Regulatory Commission’s (NERC) minimum threshold.

    The N2.7 trillion unpaid sum is for power received from NBET by the DisCos as of September 30, 2020. It includes the Nigerian Interbank Offered Rate (NIBOR) +4 per cent interest.

    Six of the 11 DisCos  -Abuja, Benin, Kaduna, Kano, Ibadan Discos and recently, Ikeja- are already facing receivership crisis.

    Read Also: New NERC chairman insists DisCos, GenCos must comply with rules

    A breakdown of the debts showed that Abuja Electricity Distribution Company has  N330.4 billion unremitted;  Benin Electricity Distribution Company, N233.2 billion; Kaduna Electricity Distribution Company,  N277.7 billion; Kano Electricity Distribution Company,  N211.7 billion; Ibadan Electricity Distribution Company, N325.7 billion and  Ikeja Electricity Distribution Company, N310 billion.

    The other DisCos and their respective debts are  Eko Electricity Distribution Company, N231 billion; Enugu Electricity Distribution Company, N258.3 billion;  Jos Electricity Distribution Company, N161.7 billion; Port Harcourt Electricity Distribution Company, N239.7 billion; and Yola Electricity Distribution Company, N107.4 billion.

    NBET Managing Director, Johnson Akinnawo, who appeared before the committee yesterday,  submitted a 2021 Auditor General’s report, which contain  the debt and multiple irregularities in the power sector.

    The infractions include  N100 billion paid by NBET   to Generation Companies (GENCOs) for electricity not delivered to the national grid; N30 billion in uncollected debt by market operators, and N166 billion in under-remittance by DisCos, below the Nigerian Electricity Regulatory Commission’s (NERC) minimum threshold.

    Others are N26 billion owed to Nigeria by two foreign firms for power exported to Togo, Benin, and Niger, and N2.7 billion in unpaid invoices by the 11 Discos.

    At the investigative hearing, Yahya Kusada moved a motion that all the affected  Discos be summoned to explain the persistent non-settlement of their financial obligations to the Federation Account.

    Kusada said: “With the magnitude of liabilities before us, these companies must appear before the Committee to clarify their positions and outline repayment plans.”

    The committee resolved to invite other market operators and participants to address the issues raised in the Auditor General’s report.

    The dates for the appearances of the affected parties are yet to be fixed.

  • Damning report

    Damning report

    With metering and billing complaints topping the list of power consumer grievances, the Fed Govt has to put in more effort to rescue Nigerians from arbitrary billing by DisCos

    If there is need for proof that the electricity distribution companies (DisCos) are not operating according to good corporate practices, the latest report by the Nigerian Electricity Regulatory Commission (NERC), is it. The report said the DisCos received a total of 1,183,198 complaints against them from electricity consumers in 2024.

    Of these, metering, billing, and service interruptions were the most common complaint issues, accounting for 72.33 per cent (855,757) of the 1,183,198 complaints.

    Similarly, NERC says it got a total of 8,351 active appeals (7,575 new appeals and 776 pending appeals) across all forum offices in 2024 and the forum offices held 308 sittings and resolved 83.06 per cent (6,936) of the total active appeals. Again, billing and metering were the most prevalent of the appeals, accounting for 52.81 per cent and 29.77 per cent, respectively, of the total.

    This report is by no means surprising.

    The trend was the same even for the first quarter of this year when the DisCos received 254,404 customer complaints. Although this represented a 7.72 per cent drop from the 275,681 complaints received in the previous quarter, the grievances centred mainly on the same issues of faulty metering, inaccurate billing and service interruptions.

    While Port Harcourt DisCo received the highest number of complaints (57,843), representing 22.74 per cent of total complaints received, Yola DisCo received the least, 2,495, representing 0.98 per cent of total complaints.

    Read Also: Govs move to attract more Foreign Direct Investments

    “Six DisCos recorded declines in the number of customer complaints received in 2025/Q1 compared to 2024/Q4. Abuja (-74.02 per cent), Benin (-30.17 per cent), and Jos (-29.16 per cent) DisCos recorded the most reductions. Kano (+86.12 per cent), Kaduna (+37.33 per cent), Yola (+30.15 per cent), Aba Power (+17.16 per cent), Ikeja (+9.98 per cent) and Port Harcourt (+5.78 per cent) DisCos on the other hand recorded increases in the number of customer complaints received between 2024/Q4 and 2025/Q1”, NERC said.

    It is significant that Port Harcourt and Ikeja DisCos had the highest billing-related complaints recorded at the NERC Customer Complaints Unit (NERC CCU) during the period.

    Metering and billing issues are somewhat intertwined. If power consumers have functional meters, the chances of billing them through rule of thumb are eliminated; meaning they will only pay for the power they consume.

    But, in the absence of meters, as largely in the present circumstance, guess work with indefensible principles are applied, leading expectedly to consumer dissatisfaction and sometimes anger.

    As a matter of fact, the issue of metering has become like a festering sore for long in the sector. Nigerians had hoped that the privatisation of the sector in 2013 would substantially address that problem. It is unfortunate that that hope has not materialised.

    Perhaps sadder still is the fact that it may never materialise, given the unreadiness of the DisCos to make it happen.

    And this is despite spirited efforts by successive governments to bridge the metering gap, which, by NERC’s own admission, is huge.

    “As of 31 December 2024, only 6,288,642 (46.57%) of the registered 13,503,342 customers in the NESI were metered. DisCos installed 572,055 enduse customer meters in 2024 using the different metering framework.”

    Yet, it is not that government has not made some attempts to solve the metering challenge. We have had all kinds of initiatives toward solving the problem.

    The Tinubu government is not left out in the quest to let Nigerian power consumers pay only for the electricity they enjoy. For instance, in 2023 it came up with the Presidential Metering Initiative (PMI) as part of its broader energy reforms, with the aim of addressing systemic inefficiencies in power supply and billing.

    Full rollout of free electricity meters under the scheme is expected to commence by the fourth quarter of this year. The initiative is expected to deliver over six million meters to end-users at no cost.

    Eriye Onagoruwa, a representative of the Special Adviser to the President on Energy, provided an update on the scheme at the Day 2 Session of the Nigerian Electricity Supply Industry Stakeholders Meeting held in Lagos, in June.

    “Over six million meters are planned from multiple sources, including DISREP, (Distribution Sector Recovery Programme) Federation Account, and the Meter Asset Fund. Key priorities include streamlining installer certification, deploying meters to high-consumption areas (starting with Band A customers), and ensuring robust communication infrastructure.”

    A good idea. But so had schemes before it that looked good at the level of policy formulation only to end up delivering little at implementation stage.

    For instance, the immediate past administration of Muhammadu Buhari also embarked on free metering scheme for power consumers. That we are yet to hit even the 50 per cent mark in spite of these fanciful schemes should tell us that something is wrong somewhere.

    We observed that the meters that were supposed to be given out free under the Buhari government were rolled out simultaneously with those of the DisCos that were sold. With the kind of DisCos that we have, our guess is as good as yours on what could have happened with the free meters.

    We don’t know if proper auditing has been done to see how many of those government meters were actually given free, especially as they were issued to power consumers simultaneously with the ones being sold.

    We therefore urge the Tinubu government to avoid such pitfalls.

    We would have done better in terms of bridging the metering gap if only the DisCos had been more cooperative in the last 13 years.

    And it is unlikely they can ever change their attitude in this regard because of the free billing they do monthly by guess work, just allocating whatever amount they like to their hapless customers as bills.

    It speaks volumes that the DisCos themselves reported that they received a whopping 1,183, 198 complaints from their about 13,503,342 customers, most bothering on billing and metering. We can assume that is for those who know about such avenue for redress. There are millions of other power consumers who are not aware or are even aware but they never got the right attention from the DisCos.

    We commend NERC for the yeoman’s job of overseeing these difficult entities.

    We also note that its 31 forum offices across Nigeria that handle consumer appeals related to electricity are grossly inadequate considering the general unwillingness of the DisCos to meter electricity consumers.

    NERC should continue to sanction recalcitrant DisCos over various infractions and sharp practices. That is the only way the planned rollout of the six million meters promised under this government can make significant impact. When that happens and DisCos no longer have cause to bill consumers arbitrarily, they will know that the era of unearned revenue is over for good and thus settle down to do business the way their counterparts in other serious parts of the world do it.

  • 11 Discos owe Federation Account N2.6 trn

    11 Discos owe Federation Account N2.6 trn

    Eleven Electricity Distribution Companies operating in the country are collectively indebted to the Federation Account to the tune of ₦2.6 trillion, the Nigerian Bulk Electricity Trading Company (NBET) PLC has said.

    Managing Director of NBET, Johnson Akinnawo disclosed the scale of the liabilities when he appeared before the House of Representatives Committee on Public Accounts on Wednesday.

    The Committee has however summoned the 11 electricity Distribution Companies (Discos) to appear before it over the outstanding debt.

    Documents submitted to the committee by NBET revealed that as at September 30, 2020, the 11 Discos collectively owe N2.6 trillion.

    The DISCOs are Abuja Electricity Distribution Company (₦330.4 billion); Eko Electricity Distribution Company (₦231 billion); Benin Electricity Distribution Company (₦233.2 billion); Enugu Electricity Distribution Company (₦258.3 billion) and Ibadan Electricity Distribution Company (₦325.7 billion).

    The others are Ikeja Electricity Distribution Company (₦310 billion); Jos Electricity Distribution Company (₦161.7 billion); Kaduna Electricity Distribution Company (₦277.7 billion); Kano Electricity Distribution Company (₦211.7 billion); Port Harcourt Electricity Distribution Company (₦239.7 billion) and Yola Electricity Distribution Company (107.4 billion)

    The 2021 Auditor General’s report, which prompted the hearing also flagged multiple irregularities in the power sector.

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    The Auditor General alleged N30 billion in uncollected debt by NBET from market operators, N549 million shortfall in NBET’s 1% income from institutional charges, N100 billion paid by NBET to Generation Companies (GENCOs) for electricity not delivered to the national grid, N26 billion owed to Nigeria by two foreign firms for power exported to Togo, Benin, and Niger, N166 billion in under-remittance by Discos, below the Nigerian Electricity Regulatory Commission’s (NERC) minimum threshold and N2.7 billion in unpaid invoices by the 11 Discos.

    At the investigative hearing, Yahya Kusada moved a motion that all the 11 Discos be summoned to explain the persistent non-settlement of their financial obligations to the Federation Account and seconded by Billy Osawaru.

    “With the magnitude of liabilities before us, it is imperative that these companies appear before the Committee to clarify their positions and outline plans for repayment,” Hon. Yahya Kusada said.

    The Committee has also resolved to invite other market operators and participants to address concerns raised in the Auditor General’s report.

    A date for the appearances will be communicated to the affected parties in due course.

  • States seek to bypass DisCos to buy energy directly from GenCos 

    States seek to bypass DisCos to buy energy directly from GenCos 

    The Forum for Commissioners of Power and Energy in Nigeria (FOCPEN), which are representatives of of State Governments has sought the signing of interim Power Purchase Agreements (PPAs) for SubCos to buy energy directly from electricity Generation Companies (GenCos).

    It is an indication that the State Governments are seeking the application of the eligible customer regulation of 2017 that makes it possible for customers to purchase energy directly from the GenCos.

    In this case, the States are requesting for agreements to bypass the DisCos in the value chain.

    According to a statement the forum issued from Abuja, “Such regulation may include a mandate for NBET to enter into direct or interim Power Purchase Agreements (PPAs) with SubCos.”

    The forum also called on the Minister of Power, Chief Adebayo Adelabu to intervene and ask the Nigerian Electricity Regulatory Commission (NERC) and Enugu Electricity Distribution Company (EEDC) to restore electricity to the people of the state.

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    The EEDC had reduced energy allocation to the state owing to the decision of the Main Power Electricity Distribution Ltd to reduce band A tariff from N209/kWh to N160/kWh.

    According to Main Power, EEDC has said implementing the adjusted tariff would cause a monthly loss of N1 billion. The EEDC has therefore reduced energy supply to the people of the State.

    Responding to the situation, the FOCPEN stressed that “FOCPEN calls upon the Minister of Power, Chief Bayo Adelabu, to immediately intervene and prevail upon NERC and EEDC to reverse the power cuts and restore electricity to the people of Enugu State.”

    The forum insisted  that as the chief policy maker for the sector, the Minister must take decisive action to stop the lawlessness by DisCos who can arbitrarily and without consequence deprive citizens of electricity.

    The forum also said NERC must develop appropriate regulations that would allow SubCos enter into bilateral contracts with GenCos to procure wholesale power from the national grid. 

    The forum said the current arrangement, where SubCos receive power through their HoldCos is an anti-competitive practice that limits their operational autonomy within SEMs and creates a potential for abuse, as evidenced by the current crisis. 

  • DisCos seek fully funded subsidy payments

    DisCos seek fully funded subsidy payments

    Following the recent downward review of Band A electricity tariff from N209/Kwh to ₦160/kWh by the Enugu Electricity Regulatory Commission (EERC), the Association of Nigeria Energy Distributors (ANED) has called on state electricity regulators to adopt fully funded subsidy schemes.

    ANED Managing Director Chief Sunday Oduntan made this call in a press statement on Thursday.

    He urged the states to come up with timely disbursed subsidy payments for prompt settlement of market invoices and liquidity improvement.

    He said, “A clear subsidy framework that is transparent, targeted, and fully funded.

    ” Timely disbursement of subsidy payments to enable prompt settlement of market invoices and improve market liquidity.”

    Oduntan asked the states to pursue the subsidy payments in a manner that preserves the financial health of the market, encourages long-term investment, and avoids policies that could erode progress toward stable, reliable electricity for Nigerians

    He said the the recent tariff reduction by EERC to ₦160/kWh for Band A customers in Enugu State, without adequate coordination with NERC and or other market participants raises significant concerns for the stability and liquidity of the Nigerian Electricity Supply Industry (NESI).

    According to him, since the release of the Tariff Order by EERC for Enugu State residents, the DisCos in other States have come under intense pressure and scrutiny to also reduce tariffs, while some customers have taken a position that they will no longer pay their electricity bills until tariffs are reduced.

    The statement reads in part, “Permit us to establish the fact that as service providers, it is our hope and desire that electricity tariffs at some point should begin to come down with time. It is not our intention to make life difficult for our loyal customers, and we have been aligning with the Federal Government to ensure provision of stable power supply. 

    “However, the cost reflective tariff is as a result of the economic realities of our nation. 

    “We note that one of the principles adopted by EERC is to place reliance on the Policy of the Federal Government on electricity subsidies to enable them crash Band A Tariffs. “While Discos are not opposed to subsidies in principle, we strongly emphasize that subsidies must be transparently structured and promptly funded.

    “Delayed or unfunded subsidies create cashflow disruptions, undermine market confidence, and deepen the existing liquidity crisis across the electricity value chain.

    “In a clear position, the Federal Government through the Minister of Power, Chief Bayo Adelabu has stated that States slashing power tariff must be ready to pay subsidy, and be accountable for the financial implication. 

    “It is already a fact today that the delay in the prompt payment of electricity subsidies has put the generation companies and gas suppliers under severe operational burden due to the almost N5 trillion outstanding to these market participants.

    “It is important to stress that the Nigerian power market, in the short term, remains largely centrally coordinated, especially for Bulk energy purchases, Transmission, and market settlements involving Generation Companies (GenCos) and the Nigerian Bulk Electricity Trading Company (NBET). 

    “We duly recognise changes in law and regulation that now permits States to set up their electricity markets. However, any State-level policy action such as uncoordinated tariff reductions that does not align with market-wide cost-recovery mechanisms will inevitably result in shortfalls in Disco remittances to the market below their current Distribution 

    “Remittance Obligations, thereby putting GenCos and other upstream service providers at further financial risk.

    We understand further that the Federal Government does not have an elastic subsidy budget. 

    “Any tariff reduction following the approach adopted by EERC may further bloat the subsidy obligations of the federal government. 

    “We believe that the Federal Ministry of Power and the Nigerian Electricity Regulatory Commission (NERC) would be watching closely to provide guidance and align State and Federal objectives to ensure electricity access is accelerated in a sustainable and affordable manner.

    The above budgetary constraints apply to the States too. “Most cannot afford to make direct budgetary provisions for subsidies especially in the face of rising governance costs and the harsh operating environment.

     *This underscores the importance of collaboration and a well coordinated market driven approach on tariff related matters.

    “To sustain investments and improve service delivery, Discos therefore reiterate the need for: Stronger coordination between Ministry of Power, State Regulators and NERC to ensure consistency in Policy and Rate design to avoid market distortion.”