The Nigerian government has taken a decisive step toward revitalizing the country’s energy sector by announcing plans to auction off five Electricity Distribution Companies (DisCos) currently managed by banks and the Asset Management Company of Nigeria (AMCON).
The announcement came from the Minister of Power, Chief Adebayo Adelabu, during an oversight visit to the ministry in Abuja on Monday, April 22.
The DisCos up for sale include the Abuja Electricity Distribution Company (AEDC), managed by the United Bank of Africa (UBA); Benin Electricity Distribution Company, under the management of Fidelity Bank; and Kaduna, Kano, and Ibadan Electricity Distribution Companies, which are managed by various financial institutions due to their inability to repay loans.
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Chief Adelabu stressed the importance of entrusting energy distribution assets to technical experts, highlighting their crucial role in the Nigerian Electricity Supply Industry (NESI).
He expressed determination to push the Nigerian Electricity Regulatory Commission (NERC) to revoke licenses of underperforming DisCos and overhaul their management boards if necessary.
Moreover, Chief Adelabu emphasized the urgency of reorganizing the DisCos for improved efficiency, especially noting the need to reevaluate the management structure of the Ibadan DisCo due to its size.
Responding to concerns raised by Senator Isah Jibrin regarding asset stripping by previous operators, Chief Adelabu assured that revoked DisCo operators would be held accountable for restoring assets to their original condition.
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Additionally, Chief Adelabu revealed that the federal government has mobilized Messr Zigglass with $200 million (N32 billion) to supply three million meters, addressing a significant gap in meter provision.
He reiterated the government’s commitment to bridging the current metering deficit within four to five years, leveraging funding from the Nigerian Sovereign Investment Authority (NISA).
However, challenges in the power sector extend beyond distribution, as highlighted during the oversight visit to the Transmission Company of Nigeria (TCN).
TCN Managing Director, Sule Abdulaziz, appealed to the committee for assistance in completing over 120 projects and addressing right-of-way issues, stressing the critical role of funding in tackling infrastructure challenges.
Independent System Operator (ISO) Executive Director, Engr. Nafisat Ali, pointed out gas shortages as a major constraint in the industry, emphasizing the need for a reliable gas supply to meet demand.
The committee, led by Senator Eyinaya Abaribe, pledged to engage with the federal government to settle outstanding gas debts and ensure the timely completion of critical projects.
They also committed to reviewing penalties for power asset vandalism and scrutinizing the recently revised tariff.
As the nation grapples with the complexities of its power sector, stakeholders remain hopeful that concerted efforts and strategic reforms will pave the way for a more resilient and sustainable energy landscape.
