NIGERIA: SHAKE UP IN THE ELECTRICITY SECTOR AS FG SET TO RE -PRIVATISE 11 DISCOS

By Chinasaokwu Helen Okoro

Federal Government is actively preparing to re-privatise all 11 DisCos unless they meet legally mandated recapitalisation requirements under the proposed Electricity Act amendment. The move marks a significant escalation in regulatory oversight and signals a potential shake‑up in Nigeria’s electricity sector.

Credible media reports—including Economic Confidential, Okay.ng, and BizWatch Nigeria—are confirming that the Federal Government of Nigeria (FG) is considering re-privatising the country’s 11 electricity Distribution Companies (DisCos) if they fail to recapitalize within 12 months under the proposed Electricity Act (Amendment) Bill, 2025 .

🔍 What’s the context?

Legislative Proposal Underway

The Electricity Act (Amendment) Bill, 2025, sponsored by Senator Enyinnaya Abaribe, has passed second reading in the National Assembly and is currently under further legislative review .

If enacted, the bill empowers NERC (Nigerian Electricity Regulatory Commission) to enforce sanctions—including share dilution, receivership, or outright re-privatisation—against DisCos that do not inject fresh capital within 12 months .

Which DisCos Are Affected?

All 11 successor DisCos created after PHCN privatisation in 2013:

Abuja, Benin, Eko, Enugu, Ibadan, Ikeja, Jos, Kaduna, Kano, Port Harcourt, and Yola Electricity Distribution Companies .

Why Is This Coming Now?

Persistent underperformance by the DisCos despite years of government bailouts and policy reforms. Many still fail to provide consistent electricity, while the sector remains burdened by debt exceeding ₦4 trillion .

Over 70% of DisCos reportedly failed to meet performance benchmarks since the 2013 privatisation .

The government is demanding operational and financial improvements, threatening dilution of stakes or takeover if capital is not injected promptly.

Sector Reactions

Power sector experts and consumer advocates argue that the sector’s subsidy debt must be cleared before enforcement can work effectively. Some recommend extending the recapitalisation deadline to 24 months, akin to banking sector reforms .

The Forum of Commissioners of Power and Energy warns against potential destabilisation of Nigeria’s decentralised electricity market established by the 2023 Electricity Act .

Some Disco representatives expressed readiness to comply, provided the implementation safeguards investor confidence and does not disrupt power services .

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