- NERC dissolved Kaduna DisCo’s board
- The company owes about N456.5bn
- A new investor will be sought
The Nigerian Electricity Regulatory Commission has taken control measures against Kaduna Electricity Distribution Plc after the company accumulated about N456.5bn in outstanding market obligations and continued to struggle with its financial and operational performance.
Eko Hot Blog gathered that under an order that came into force on Monday, August 10, 2026, NERC dissolved the company’s existing board and installed an interim team to oversee its affairs.
The regulator also directed that a new core investor be sought through an open and competitive process.
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The decision was contained in Order No. NERC/2026/086, issued under the Electricity Act 2023.
NERC said the intervention followed an assessment of KAEDC’s financial position and consultations with relevant stakeholders, including the Bureau of Public Enterprises.
According to the commission, the electricity distributor had remained in serious regulatory and market default while failing to attract sufficient investment or achieve meaningful improvements in its commercial and operational performance.
The regulator put KAEDC’s outstanding market obligations at approximately N456.5bn as of May 2026. Of that amount, N415.5bn was owed to the Nigerian Bulk Electricity Trading Plc, while another N41bn was payable to the Nigerian Independent System Operator.
Beyond those obligations, NERC said the company had accumulated an additional N14.26bn in statutory and third-party liabilities.
The commission also linked a significant portion of the recent deterioration to the period following ASI Engineering Limited’s takeover of the company in June 2024. Since then, KAEDC reportedly incurred more than N118.6bn in additional market debt through May 2026.
NERC said the distributor’s payment record had also remained weak. In 2025, KAEDC settled only 41.93 per cent of its adjusted market bills, leaving a shortfall of roughly N46.71bn.
The regulator attributed the poor payment performance partly to the company’s high technical, commercial and collection losses. Those losses reached 71.88 per cent in 2025, meaning the distributor was effectively accounting for only about 28.2 per cent of the electricity supplied to it and delivered to customers during the period under review.
Investment in the network also fell significantly below the required level.
NERC said KAEDC spent approximately N2.48bn on capital projects in 2025, compared with a regulatory minimum of N24.51bn. The actual expenditure therefore represented only about 10 per cent of the required investment.
Metering also remained a major concern. According to the regulator, KAEDC’s meter coverage stayed within a narrow range of 33.26 to 35.54 per cent after ASI assumed control, despite several industry-wide initiatives designed to improve metering.
The commission noted that the company’s financial problems continued despite receiving significant regulatory and government support. It said KAEDC benefited from about N6.58bn in regulatory derogations between January 2024 and May 2026, in addition to approximately N53.79bn in Federal Government interventions since July 2018.
NERC warned that allowing the situation to continue could threaten electricity supply, creditors, consumers and the stability of the wider Nigerian Electricity Supply Industry.
The regulator said it had previously engaged KAEDC’s major shareholders and Afrexim Bank over the company’s financial condition and asked them to produce a workable recovery plan.
A meeting involving ASI, NERC, BPE, Afrexim Bank and Fidelity Bank was subsequently held on June 11, 2026, to consider possible measures to rescue the electricity distributor.
However, NERC said the stakeholders concluded that ASI had not met key conditions connected to its acquisition of a 60 per cent controlling interest in KAEDC. The company was also said to have failed to satisfy requirements set by the BPE regarding the completion of the shareholding arrangements.
ASI later sought as much as 24 additional months to improve KAEDC’s cash flow, undertake priority investments and gradually restore full market remittances.
NERC rejected the request, arguing that ASI had already exercised effective control of the company since June 2024 without delivering the expected turnaround in its financial and operational performance.
The commission therefore invoked its powers under Sections 75 to 79 of the Electricity Act 2023 to intervene in the company’s affairs.
NERC said the objective was not to shut down KAEDC but to preserve it as a going concern while creating a pathway for the arrival of a financially credible core investor.
The regulator cited the company’s mounting liabilities, persistent defaults, inadequate investment, governance concerns and the risk of disruption to electricity distribution as reasons for its decision.
It subsequently ordered the removal of every member of KAEDC’s existing board.
Seven special directors were appointed to form an interim board, headed by Dr Abdullahi Garba.
The other members are Engr Francis Agoha, Mr Aliyy Aliyu, retired Major General Henry Ayamasaowei, Dr Haliru Dikko, Mr Ayodeji Gbeleyi of the Bureau of Public Enterprises and Dr Abubakar Umar Hashidu.
Hashidu, who is the company’s serving Managing Director and Chief Executive Officer, was separately appointed administrator for an initial six-month period, subject to regulatory review.
As administrator, he is expected to oversee daily operations, maintain uninterrupted electricity distribution, implement decisions of the interim board and ensure the protection of KAEDC’s assets and records.
NERC also withdrew the existing Know-Your-Licensee approvals for members of KAEDC’s management team. Affected officials were instructed to undergo a fresh validation process.
At the same time, Afrexim Bank was directed to coordinate the search for a replacement core investor through a transparent and competitive process.
The successful investor will require NERC’s approval, while the selection process is expected to be completed within 12 months of the order taking effect, unless the commission grants a written extension.
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