The Federal Government may re‑privatise the 11 regional electricity distribution companies if the Electricity Act (Amendment) Bill, 2025, is enacted.
The bill, now before the National Assembly, introduces sweeping reforms that could strip existing investors of their holdings if they fail to make fresh capital injections within 12 months.
Sponsored by Senator Enyinnaya Abaribe (Abia South), the amendment seeks to fill regulatory gaps in the 2023 Electricity Act. It warns that unless investors recapitalise, NERC may pursue share dilution, receivership, or outright re-privatisation following years of subpar performance and increasing sector debt.
Upon presidential assent, the bill will empower NERC to enforce compliance: investors must recapitalise their companies or face consequences including losing equity or control.
The proposed law mandates that within 12 months of its enactment, the Minister of Power — in concert with NERC — establish a comprehensive financing framework. This framework should attract long-term local currency investment, mitigate currency risk, phase out unstructured subsidies, and address a sector debt debt overhang estimated at over ₦4 trillion.
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Nigeria’s 11 Discos include:
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Abuja, Benin, Eko, Enugu, Ibadan,
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Ikeja, Jos, Kaduna, Kano, Port Harcourt, and Yola Electricity Distribution Companies.
Power experts and consumer advocacy groups argue that implementing the bill effectively will require first settling long-standing subsidy debts and possibly extending recapitalisation deadlines from 12 to 24 months—a model similar to banking sector reforms—to ensure a smoother transition.
At a May 2025 media briefing, Power Minister Adebayo Adelabu expressed dissatisfaction with Disco performance, noting that despite tranches of bailouts, many Nigerians still lack reliable electricity. He warned investors to either inject capital or yield ground to those who will
A Bureau of Public Enterprises report from May 2025 showed that over 70% of Discos failed to meet performance benchmarks set during the 2013 privatisation.
While some Disco officials dismissed concerns—emphasising that laws become binding upon assent and must be implemented—others in the sector stressed that simplifying tariff regimes and resolving debt issues must precede recapitalisation efforts.
Amid these reforms, the Ministry of Power plans pilot programmes to restructure underperforming Discos across Nigeria, working with international partners to guide the transition before the bill takes full effect.
Punch Newspaper
