House of Reps Demands N500bn Recapitalisation for DisCos
Lawmakers cite 'reckless actions' and poor service delivery as basis for stricter financial requirements
The House of Representatives has issued a call for Nigeria’s electricity Distribution Companies (DisCos) to meet a minimum recapitalisation threshold of N500 billion to continue operations, amid growing concerns over their financial capacity and service delivery.
During Wednesday’s plenary session, the House condemned what it described as “sabotage of economic development” by the DisCos, with Rep. Ibrahim Ayokunle Isiaka noting that consumers are being “coerced into paying for meters which they had earlier financed, causing financial strain on households and businesses already facing economic challenges.”
The lawmakers urged the Federal Ministry of Power to declare DisCos as “non-state actors” and address their “reckless actions, threatening the nation’s economy.” The House has mandated its Committee on Power to investigate the DisCos’ activities, with particular focus on consumer rights protection.
The Nigerian Electricity Regulatory Commission (NERC) has already taken action, implementing penalties in July 2024 for DisCos failing to distribute at least 95 percent of the total monthly energy allocated for distribution to consumers.
Industry stakeholder, Edu Okeke, Managing Director of Azura Power West Africa, supported the recapitalisation call, stating that “many DisCos carry a heavy burden of debt” and suggesting that “no DisCo should operate without at least $250 million in shareholder funds.” He emphasized that “this situation must change” and recommended “removing these debts from the DisCos books and mandating them to increase their capital by at least $500 million each.”
The federal government has reportedly approved N1.623 trillion in various intervention funds since privatizing the power sector in 2013, supporting the operations of the country’s 11 distribution companies.
