The Nigerian Electricity Regulatory Commission, NERC, has dissolved the board of Kaduna Electricity Distribution Company, KAEDC, over persistent non-remittance to the electricity market and failure to improve operational performance.
The decision is contained in Order No. NERC/2026/086 issued in Abuja on Monday and signed by NERC Chairman, Mr. Musiliu Oseni, and Commissioner for Legal, Licensing and Compliance, Mr. Dafe Akpeneye.
According to the order, the dissolution took effect from Aug. 10 following an inquiry and consultations with key industry stakeholders, including the Bureau of Public Enterprises, BPE.
NERC also appointed Mr. Abubakar Hashidu as KAEDC’s Interim Managing Director/Chief Executive Officer for an initial six-month period to oversee the company’s operations during the transition.
The commission said the action followed the inability of the company’s new owners to meet market remittance obligations and implement measures to expand and improve the electricity distribution network.
According to the order, KAEDC’s cumulative market obligation since privatization stood at about N456.5 billion as of May 2026.
The debt comprises N415.5 billion owed to the Nigerian Bulk Electricity Trading Plc and N41 billion owed to the Nigerian Independent System Operator.
The commission said the company also accumulated non-market statutory and third-party obligations estimated at N14.26 billion during the period under review.
“Since the takeover of operations in KAEDC by ASI Engineering Limited (“ASI” or the “Core Investor”) in June 2024, the Licensee accrued additional market debt in excess of N118.6 billion as at May 2026.
“The Core Investor and KAEDC have persistently failed to furnish NBET and NISO with acceptable and credible payment bank guarantees.
“This is in compliance with the terms of their vesting contract and the provisions of the Market Rules of the Nigerian Electricity Supply Industry. “The Core Investor has also failed to present a credible payment plan for these liabilities,” the commission stated.
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NERC said KAEDC paid only 41.93 per cent of its adjusted market invoices, leaving a market shortfall of approximately N46.71 billion during the review period ending Dec. 31, 2025.
The commission attributed the poor performance to the company’s high Aggregate Technical, Commercial and Collection losses of 71.88 per cent.
It said the loss level meant that KAEDC was able to account for only 28.2 per cent of the energy received and delivered to end-use customers during the 2025 review period.
According to NERC, investigations showed that regulatory derogations and Federal Government interventions had failed to reverse the utility’s decline, in spite of the grant of about N6.58 billion in derogations between January 2024 and May 2026.
It added that aggregate Federal Government intervention disbursements to the company since July 2018 amounted to approximately N53.79 billion.
“While aggregate Federal Government intervention disbursements since July 2018 were approximately N53.79 billion, the continued underperformance therefore poses material risk to end-use customers, creditors, market stability and continuity of electricity service.
“The analysis confirms that KAEDC is experiencing severe liquidity constraints and that its commercial viability and continued participation in the market poses a systemic risk to NESI,” the order stated.
NERC said that in spite of regulatory initiatives and substantial government interventions, KAEDC’s board failed to present a credible, funded and measurable recovery plan capable of restoring operational efficiency and financial sustainability.
The commission said it had earlier issued a notification of imminent regulatory intervention to the company’s major shareholders and the Africa Export-Import Bank (Afreximbank), requesting a viable plan to address the utility’s financial challenges.
“The notification required the parties to present a credible plan that addresses the financial situation of the utility, failing which the commission would intervene in accordance with the provisions of the Electricity Act 2023,” it said.
NERC said it had constituted an interim board to oversee the company’s affairs for six months in order to halt operational failures, maintain service continuity and protect electricity consumers and market participants.
“KAEDC’s board of directors is hereby dissolved. All directors of KAEDC are removed from office, and the existing board stands dissolved pursuant to Section 75 of the Electricity Act,” the commission stated.
The order added that the Corporate Affairs Commission and other relevant stakeholders had been notified of the dissolution of KAEDC’s board.
It directed that no changes to the company’s shareholding, directorship or constitutional records be registered during the transition period without NERC’s prior approval.
It was reported that the regulatory intervention comes about two years after ASI Engineering Limited took over the management of KAEDC in June 2024.
NAN
