The Federal Government has expressed deep concern over the continued underperformance of Electricity Distribution Companies (DisCos), accusing them of undermining efforts to reform Nigeria’s power sector. According to the Minister of Power, Chief Adebayo Adelabu, DisCos remain the weakest link in the electricity value chain, threatening to derail progress made in power generation and transmission. Speaking at a two-day retreat organized by the Senate Committee on Power, Adelabu highlighted how the inefficiency and failure of DisCos to fulfill their responsibilities could sabotage improvements elsewhere in the sector.
In a statement issued by his media aide, Mr. Bolaji Tunji, Adelabu criticized DisCos for failing to deliver on expectations since the sector’s restructuring in 2003. He recalled that these companies were initially expected to bring in technical partners to upgrade infrastructure and improve services. However, most of these partnerships were short-lived, and instead of investing in critical infrastructure, many DisCos diverted funds to repay loans used to purchase the assets.
Despite tariff revisions that increased liquidity and raised total revenue in the sector from ₦1 trillion in 2023 to ₦1.7 trillion in 2024, the Minister pointed out that DisCos still struggle with efficiency. For instance, Northern DisCos remitted only 30 percent of their ₦408.86 billion invoice in the last quarter of 2024, with Abuja DisCo alone accounting for the majority of that payment. Southern DisCos performed slightly better, remitting 67 percent, although Lagos DisCo contributed 70 percent of the total from that region. These imbalances were largely blamed on poor infrastructure in less economically viable regions.
Adelabu also drew attention to the widespread metering gap, which continues to fuel billing disputes and revenue leakage. To tackle this, the government has launched the ₦700 billion Presidential Metering Initiative and partnered with the World Bank to deploy 4.3 million meters by 2025. As of April 2024, 75,000 meters had been installed, with an additional 200,000 expected in May. He acknowledged that closing this gap is vital for fair billing and financial stability, but progress has been slow due to persistent underinvestment and inefficiencies.
The Minister further revealed that the power sector is facing a massive ₦4 trillion subsidy backlog, with ₦1.94 trillion owed for 2024 alone. Monthly subsidy deficits have now reached ₦200 billion, making the current tariff structure unsustainable. To remedy the situation, the government plans to restructure poorly performing DisCos and enforce stricter performance standards.
Adelabu warned that without immediate capital investments in distribution infrastructure, advancements in generation and transmission—including a record 6,003MW generated in March 2025 and the installation of 61 new transformers—will not translate into reliable power supply for households.
Looking ahead, the government is also exploring initiatives to enhance power generation in Northern Nigeria. These include the development of the 1,000-megawatt Makurdi hydropower project and the revival of the long-abandoned 215MW Kaduna thermal plant, which is already nearing completion. Additionally, the Katsina State government has shown interest in reviving the 10MW wind farm in collaboration with private investors, with a feasibility study already underway for its concession.