The Federal Government has expressed deep dissatisfaction with the performance of electricity distribution companies (DisCos) in the Nigerian Electricity Supply Industry (NESI), citing underperformance, poor investment, and operational inefficiencies as critical obstacles to progress in the sector.
Minister of Power, Adebayo Adelabu, made the remarks at a two-day retreat organised by the Senate Committee on Power. He stated that DisCos are frustrating government efforts to enhance electricity supply, despite significant reforms and improvements in generation and transmission. “We need to get tough with the DisCos, as they can easily frustrate all the gains we have made. They have disappointed us in performance expectations,” Adelabu said.
According to a statement by Bolaji Tunji, Special Adviser on Strategic Communication and Media Relations, the minister decried the persistent crisis in the sector, particularly the chronic underinvestment in distribution infrastructure. He noted that while the sector’s revenue rose from ₦1 trillion in 2023 to ₦1.7 trillion in 2024, the distribution segment remains the weakest link, with widespread electricity theft, aging networks, and poor remittance by DisCos.
Adelabu revealed that in the fourth quarter of 2024, Northern DisCos remitted only ₦124.4 billion (30%) out of ₦408.86 billion invoiced, while Southern DisCos paid ₦254.6 billion (67%), most of which came from Lagos-based operators. He attributed these disparities to the collapse of infrastructure outside major economic hubs.
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He also highlighted the metering gap as a major issue contributing to revenue losses and consumer distrust. To address this, the government has launched a ₦700 billion Presidential Metering Initiative (PMI) and a World Bank-supported programme aiming to install 4.3 million meters by 2025. Despite deploying 75,000 meters in April and targeting 200,000 more in May, the minister admitted that progress has been slow due to underinvestment.
Adelabu warned that maintaining current electricity tariffs is “unsustainable” as subsidy backlogs have reached ₦4 trillion, including ₦1.94 trillion for 2024 alone. Monthly subsidy shortfalls now average ₦200 billion, putting immense strain on public finances.
To salvage the power sector, Adelabu announced plans to restructure underperforming DisCos and enforce stricter performance benchmarks. He also unveiled strategies to attract private investment in grid infrastructure, regionalise transmission networks, and deploy legal reforms to deter vandalism of critical power assets.
He called on the National Assembly to pass stronger laws to protect energy infrastructure, stressing that only through robust legal frameworks and capital injection into distribution can the country achieve reliable and sustainable electricity supply.
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