FG Plans Sale of DisCos Managed by Banks, AMCON July

The Federal Government plans to sell the five electricity Distribution Companies (DisCos) managed by banks and Asset Management Company (AMCON) to technical power operators by July 2024.

Minister of Power, Adebayo Adelabu, disclosed this during an oversight visit of the Senate Committee on Power to the ministry in Abuja on Monday.

The Nigerian government, alongside Fidelity Bank and AMCON, intervened in 2022 to save Kano Electricity Distribution Company (KEDCO), Ibadan Electricity Distribution Company (IBEDC), Benin Electricity Distribution Company (BEDC), Kaduna Electric, and Port Harcourt Electricity Distribution Company (PHED) from insolvency.

Adelabu cited the continued poor performance of these DisCos as a setback to the Nigerian Electricity Supply Industry (NESI).

He emphasized the need for tough decisions, including revoking underperforming licenses and changing DisCos’ management boards if necessary. Adelabu announced that DisCos under AMCON and banks must be sold to technically proficient operators within the next three months.

Regarding the nation’s metering gap, Adelabu revealed ongoing efforts to bridge it within the next four to five years, with the government mobilizing $200 million through Messr Zigglass for the supply of three million meters.

Addressing challenges in the industry, Adelabu urged approval of funds for completing over 120 projects nationwide.

Isah Jibrin, a committee member, highlighted concerns about DisCos stripping assets and insisted that revoked DisCos must restore assets to their original state.

Chairman of the Senate Committee on Power, Enyinnaya Abaribe, assured increased budgetary allocation to the sector to address challenges.

Abaribe announced the Senate’s resolve to investigate the recent electricity tariff hike, scheduling an investigative hearing for the 29th of the month. He emphasized the need for a reliable power supply to stabilize funding for Transmission Company of Nigeria (TCN) operations.

Nafisat Ali, Executive Director of Independent System Operator (ISO) at TCN, outlined challenges facing the power sector, including grid collapses and distribution network weaknesses. She stressed the importance of adequate capacity and investment in maintaining a reliable power system.