The Federal Government has launched a major reform to address the persistent challenges in Nigeria’s electricity distribution sector, starting with a pilot restructuring of two underperforming Distribution Companies (DisCos).
This initiative follows a detailed review of systemic issues facing the DisCos—ranging from poor governance and inadequate infrastructure to commercial inefficiencies. Minister of Power, Chief Adebayo Adelabu, announced the plan after a strategy session with the Japan International Cooperation Agency (JICA), which presented a reform blueprint titled “Revamping of the Distribution Sector in Nigeria.”
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The pilot, set to run between May and August 2025, will focus on one DisCo in the North and another in the South. The goal is to create a model for nationwide reform by combining internal restructuring, expert input, and federal oversight to boost efficiency and service delivery.
JICA’s proposal emphasizes reforming the sector “from within” by integrating external experts, strengthening leadership, and aligning government support with quick, measurable outcomes in the pilot areas.
Minister Adelabu underscored the urgency of action:
“We can no longer stand by while DisCos underperform. This pilot is non-negotiable. We will use regulatory powers to enforce compliance and restructure where necessary.”
He acknowledged past resistance to reforms but pledged a firmer approach, addressing both nationwide issues like vandalism and governance, as well as regional challenges such as cultural barriers.
A major concern, Adelabu noted, is the DisCos’ inability to invest in infrastructure.
“It’s not just unwillingness—returns on investment are low. We must attract investors and franchise both viable and struggling areas to capable operators,” he said.
The Minister directed the Nigerian Electricity Regulatory Commission (NERC) to enforce franchising opportunities and ensure full cooperation from DisCos.
“This time, we will be intentional and decisive. NERC must secure their buy-in,” he stated.
Public education will also play a key role. Adelabu emphasized the need to clarify the distinct roles of generation, transmission, and distribution companies to Nigerian consumers, saying,
“Too many people still view the sector as a single entity. Educating the public is vital for building trust and support.”
JICA’s proposal, developed after the Minister’s visit to Japan, highlights a holistic, measurable approach. Takeshi Kikukawa, JICA’s Power Sector Policy Advisor to Nigeria, said,
“Our aim is to achieve immediate results in the pilot areas while laying a sustainable foundation for broader reform.”
The Federal Ministry of Power and NERC will finalize pilot details in the coming months, focusing on DisCos with the most severe operational issues. This initiative signals the government’s strongest push yet to resolve the distribution crisis and restore investor confidence and reliable electricity access across Nigeria.
