The Federal Government has announced a major overhaul of the power distribution sector, beginning with a pilot reform programme targeting two underperforming Distribution Companies (DisCos).
The pilot, scheduled to commence between May and August 2025, will involve one DisCo each from the North and South of the country.
The move, THEWHISTLER, gathered, followed a comprehensive diagnosis of the sector’s deficiencies, including weak governance, poor infrastructure, and commercial inefficiencies.
The Minister of Power, Chief Adebayo Adelabu, disclosed the plan after receiving a roadmap from the Japanese International Cooperation Agency (JICA), titled: “Revamping of the Distribution Sector in Nigeria.”
A statement issued in Abuja by Mr Bolaji Tunji, Special Adviser, Strategic Communications and Media Relations to the minister, on Monday, stated that he presented a document during a high-level meeting in Abuja.
“We can no longer fold our hands and watch the inadequacies of DisCos, whose performances fall short of expectations. This pilot is not optional—we will use regulatory authority to restructure underperforming DisCos and compel compliance if necessary,” Adelabu said.
The Minister noted that while past interventions encountered resistance, the new approach will be “intentional and decisive,” tackling both national and region-specific obstacles, including vandalism, leadership failures, and socio-cultural challenges that hinder operations in some areas.
Adelabu emphasized the need to unlock investment in distribution infrastructure, saying the DisCos’ reluctance to upgrade assets is tied to weak incentives and poor returns on capital.
“We must attract new investors and franchise both viable and non-viable service areas to capable operators,” he stated.
“To drive implementation, the Nigeria Electricity Regulatory Commission (NERC) has been mandated to enforce franchising frameworks and secure DisCos’ cooperation.
“Past efforts failed due to resistance, but this time, we are determined to succeed. The government also plans a public enlightenment campaign to educate Nigerians on the distinct roles of generation, transmission, and distribution entities.
“Many still see the power sector as a single entity. Consumer education is critical to building trust and support for these reforms,” Adelabu added.
THE WHISTLER had last Thursday reported that twelve years after the privatisation of Nigeria’s power sector, stakeholders have expressed deep concerns over the failure to review the licences of electricity distribution companies (Discos).
To this end, they demanded their revocation over alleged inefficiency and poor performance.
THE WHISLTER recalls that the power sector in Nigeria was officially privatised on November 1, 2013.
This followed the implementation of the Electric Power Sector Reform Act (EPSRA) of 2005, which set the foundation for unbundling the state-owned Power Holding Company of Nigeria (PHCN) into 18 successor companies; six generation companies (GenCos), 11 distribution companies (DisCos), and one transmission company (TCN).
While the generation and distribution companies were sold to private investors, the Transmission Company of Nigeria (TCN) remains under government control.
Speaking with THE WHISTLER in Abuja, the President of the Nigeria Consumer Protection Network, Kunle Kola-Olubiyo, said the Discos have failed to meet their investment obligations and continue to shift operational costs to electricity consumers.
Kola-Olubiyo criticised the inability of Discos to fund basic infrastructure projects, citing examples such as Jahi in Abuja, where residents reportedly contributed as much as N500,000 to fix faults.
He noted that the licences granted in 2013 as part of the power sector privatisation were never intended to last indefinitely.
According to him, more than a decade after privatisation, many Discos are technically and financially insolvent and unable to meet the expectations of Nigerians.
He further lamented the rise in electricity tariffs without a commensurate improvement in service delivery.
“Look at the DisCos, they are not even putting in their investment. There are issues around feeder 6, around Dei-Dei, Kubwa, and in several parts of the country, and end-user customers have been asked to contribute money to buy a transformer.
“This privatisation license was not meant to last forever. The privatisation license that was issued in 2013 was embedded with a mid-term review of five years later, in 2018.
“ The players or the operator induced government institutions or officials that are supposed to call for the review and make sure that the review was not done in 20I3.
“The essence of it is to take stock and know where we have progressed well and where we have failed. Now, ten years down the line, the licenses are not being reviewed, and most of the DisCos are technically and financially insolvent.
“When I say technically, they can’t even buy little equipment. Everything is being put on the consumers. Some years ago, before 2013, the electricity tariff was less than N10.
“Now, if you vend today in Abuja, N1000 will give you four units. That is about two nights. That is a tariff of N250. So, having a tariff of N250, you are not even guaranteed an efficient service delivery. At least the entire privatisation calls for a review’’, Kola-Olubiyo said.
Also, the National President of the Association for Public Policy Analysis (APPA), Mr. Princewill Okorie, told THE WHISTLER that the DisCos’ licences should not only be reviewed but outrightly revoked.
He accused the DisCos of failing to meet the conditions set during the 2013 handover and questioned their investment record in the power distribution network.
Okorie alleged that the DisCos have repeatedly violated regulations and failed to deliver on service expectations.
He said, “Their licences should not be reviewed. They should be removed. What are they doing? Are they performing? Their licences should be reviewed, and they should be proscribed.
“There should be a new way of handling this (power sector privatisation). Discos are just collecting money without investing.
“Have you done the evaluation performance of Discos? How will you raise their? How much did they buy the investment for, and how much have they invested?
“Have they fulfilled the take-off condition since 2013? Have they fulfilled anyone? What investment have they made in the network? Except that they have been collecting money from the government and the consumers.
“They have been violating laws here and there, and is that what we will renew their licences for? We can’t renew the licences of ineffective and inefficient organisations that are ruining the country. The economy is dying. Their licences are not worthy to be renewed, and that is my position’’.
