‘Their performances below expectation’: FG to overhaul DisCos operations

The Federal Government has commenced moves to initiate sweeping reforms to revitalise Nigeria’s electricity distribution sector, starting with a pilot overhaul of two underperforming distribution companies (DisCos).

The move followed a comprehensive assessment of systemic challenges plaguing the DisCos, including governance gaps, infrastructure deficits, and commercial inefficiencies.

The Minister of Power, Adebayo Adelabu, disclosed the plan after a meeting with the Japanese International Cooperation Agency (JICA) on Monday, May 12, 2025.

The pilot scheme, slated to commence between May and August 2025, will target one DisCo in the North and another in the South.

It aims to demonstrate a replicable model for operational turnaround, combining internal restructuring, external expertise, and federal oversight to achieve rapid improvements in service delivery.

Adelabu stressed the urgency of the intervention, saying: “We can no longer fold our hands and watch the inadequacies of DisCos whose performances fall short of expectations.

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“This pilot is not optional – we will use regulatory authority to restructure underperforming DisCos and compel compliance if necessary.”

He acknowledged persistent resistance to past reforms but vowed to address both universal challenges – such as vandalism and governance – and region-specific issues, including cultural barriers hindering operations.

The minister added: “Key to the initiative is resolving the DisCos’ inability to invest in infrastructure upgrades.

“Their lack of investment is not solely due to unwillingness but also a lack of incentives. Returns on infrastructure spending are not commensurate, so we must attract investors and franchise viable and the not so viable areas to capable operators, so we can have a mix.”

Adelabu directed the Nigeria Electricity Regulatory Commission (NERC) to enforce franchising opportunities and ensure DisCos’ cooperation.

“NERC must secure their buy-in. Past efforts failed due to resistance, but this time, we will be intentional and decisive,” he noted.

The Star