- Analyst suggests a 24-month window
- Power sector experts and consumer advocates recommend settling existing subsidy debts
- Adelabu warns discos to invest or face replacement
By Isaac Adegboye
The Federal Government of Nigeria is contemplating the sale of its 11 power distribution companies (Discos) through re-privatisation if the proposed Electricity Act (Amendment) Bill, 2025, becomes law.
Eko Hot Blog reports that this move directly addresses the Discos’ poor performance and the sector’s escalating N4 trillion debt crisis.
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The bill sponsored by Senator Enyinnaya Abaribe, seeks to reform the 2023 Electricity Act, compelling investors to inject fresh capital within 12 months or face re-privatisation. If enacted, the Nigerian Electricity Regulatory Commission (NERC) will enforce these actions.
However, the Forum of Commissioners of Power and Energy criticizes the amendment, fearing it could jeopardize the decentralized electricity market and reverse reforms.
The bill also proposes overhauling the Nigerian Electricity Supply Industry’s financial structure within a year.
This targets attracting local currency investments and phasing out subsidies, requiring the Minister of Power and NERC to develop a financing framework to protect investments and resolve sector debt.
Power sector experts and consumer advocates recommend settling existing subsidy debts and extending the recapitalisation deadline to 24 months, similar to the banking sector. They advocate for clear tariffs, Disco recapitalisation under NERC, and fiscal incentives to prevent sector collapse.
The minster of power, Adebayo Adelabu openly expressed his disappointment, calling their performance “grossly underwhelming.” He emphasized that these companies must either invest more or be replaced referencing to thier previous performance reported May, 2025 where they failed to meet standards.
While some officials are ready to comply, experts like Chinedu Amah highlight implementation, not policy, as the core issue.
Analyst Habu Sadiek supports the initiative but stresses government settlement of outstanding subsidies and allowing cost-reflective tariffs before recapitalisation, also suggesting a 24-month window.
The Minister confirms ongoing efforts to restructure underperforming Discos.
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