The Federal Government has ordered the sale of power distribution companies (Discos) that have been taken over by banks and the Assets Management Corporation of Nigeria (AMCON) from its original investors/owners.
Dateline Nigeria reports that four Discos will be affected. They are Abuja Electricity Distribution Company (AEDC), Benin Electricity Distribution Company (BEDC), Kaduna Electricity Distribution Company (KAEDCO), Kano Electricity Distribution Company (KEDCO) and Ibadan Electricity Distribution Company (IBEDC).
While AEDC is under the management of the United Bank of Africa (UBA), Fidelity Bank manages BEDC, KAEDCO and KEDCO. IBEDC is under AMCON management. The four Discos are under these new managements due to their inability to repay their loans to the financial institutions.
Speaking while playing host to the Senate Committee on Power, led Senator Eyinnaya Abaribe on Monday, the Minister of Power, Adebayo Adelabu, stated that the Federal Government had commenced the restructuring of Nigeria’s 11 power distribution companies.
He also revealed that over 100 projects of the Transmission Company of Nigeria have not been completed since 2001, a period of about 23 years.
Adelabu said, “We are unbundling the Discos along state lines. Some of the Discos are too big for efficiency. They are too big for effectiveness. Ibadan Disco covers seven states. It is practically impossible for them to be efficient.
“So we are rearranging and restructuring the Discos along state lines so that each state government will know the responsible Disco for their states. Also, the federal and state governments should start exercising their rights in the operation and management of the Discos because we still own 40 per cent in the firms.
“But we have left it for the private sector operators for too long and they have messed it up. So the government must come back to take over its own right in the Discos. We are also planning to franchise the unserved communities under the Discos.”
The minister went ahead to state that “we will start seeing regulations about franchising. The fact you are Eko Disco doesn’t mean that you cannot have smaller Discos that are ready to invest in your unserved communities. So we are looking at franchising.”
Adelabu further revealed that the Oyo State Government had written to the Federal Government stating that it wants to exercise its rights in Ibadan Disco.
He said the Nigerian Electricity Regulatory Commission has been made to realise that it must sanction Discos that fail to perform, as the licences of some of the power firms might be withdrawn for non-performance.
