Nigeria’s Federal Government has announced plans to unbundle power distribution companies (Discos) along state lines, aiming to tackle inefficiency and ineffectiveness stemming from their large sizes. Despite affirming that the privatization of these firms won’t be reversed, the government emphasized the necessity of restructuring Discos into more efficient units to fulfill their mandates.
In a move to address ownership issues, the government has ordered the sale of Discos currently managed by banks and the Assets Management Corporation, citing their inability to repay loans. Notably, four Discos, including Abuja, Benin, Kaduna, and Kano Electricity Distribution Companies, are under bank management, while the Ibadan Electricity Distribution Company is under AMCON.
Minister of Power, Adebayo Adelabu, highlighted the government’s initiative to restructure the country’s 11 power distribution companies, aiming to enhance operational efficiency. He stressed the need for collaboration between federal and state governments in managing Discos and hinted at franchising unserved communities under them.
Moreover, Adelabu acknowledged challenges faced during privatization, attributing them to investors lacking expertise and financial capacity. He emphasized incomplete projects within the Transmission Company of Nigeria since 2001, urging for their completion to improve the power sector’s performance.
The minister also addressed the metering gap, revealing a significant shortfall in meter provision despite past investments. To address this, a Presidential Metering Council has been formed, aiming to close the metering gap within the next few years.
Adelabu outlined the government’s target to achieve 6,000MW of power generation by the year’s end, highlighting ongoing discussions with investors for solar power projects and the need for debt payment to gas companies and power generation firms. He emphasized the importance of infrastructure development and demand management to enhance power generation and distribution across the nation.
