Fed Govt to Resell DisCos Managed by Banks, AMCON in Three Months

The federal government has announced its intention to sell off the five electricity Distribution Companies (DisCos) currently managed by banks and the Asset Management Company of Nigeria (AMCON) within the next three months to reputable technical power operators.

Currently, the Abuja Electricity Distribution Company (AEDC) is under the management of the United Bank of Africa (UBA), while Fidelity Bank manages the Benin, Kaduna, and Kano Electricity Distribution Companies. Additionally, the Ibadan Electricity Distribution Company is under the management of AMCON. These arrangements arose due to the DisCos’ inability to repay their loans.

Minister of Power, Chief Adebayo Adelabu, disclosed this during an oversight visit to the ministry in Abuja, emphasizing the need for technical expertise in managing energy distribution assets. He stressed that tough decisions regarding the DisCos were necessary for the Nigerian Electricity Supply Industry (NESI) to function effectively.

Adelabu highlighted the ministry’s efforts to pressure the Nigerian Electricity Regulatory Commission (NERC) to enforce stricter regulations, including revoking licenses for underperforming DisCos and potentially changing their management boards.

He emphasized the importance of restructuring the DisCos for efficiency, suggesting that the Ibadan DisCo’s size necessitated multiple management entities.

Responding to the decision to resell the DisCos, Senator Isah Jibrin expressed concerns about asset stripping by some operators who took over in 2013. He called for revoked DisCos’ operators to restore assets to their original condition.

Adelabu also revealed that a company named Messr Zigglass had been mobilized with $200 million to supply three million meters, with plans to bridge the current eight million metering gap in the next four to five years. He assured that funding for these initiatives would come from various sources, including the Nigerian Sovereign Investment Authority (NSIA).

However, challenges such as uncompleted projects and grid collapses persist in the power sector, prompting calls for increased oversight and funding allocation.

The oversight committee, led by Senator Eyinaya Abaribe, pledged to address outstanding issues, including the government’s gas debt to Generation Companies and the need for completion of World Bank projects.

In conclusion, the committee emphasized the importance of collaboration between government stakeholders to tackle the sector’s challenges effectively.