Power Minister Blames DisCos for Nigeria's Electricity Failures, Threatens License Revocation

• The federal government will not renew the licences of underperforming electricity distribution companies (DisCos) when they expire in 2028
• The Minister of Power blamed the DisCos for ongoing power supply issues and pledged reforms, including universal metering within five years
• A N4 trillion bond has been approved to clear debts owed to GenCos, alongside plans for a targeted subsidy to support vulnerable households

Legit.ng journalist Victor Enengedi has over a decade's experience covering Energy, MSMEs, Technology, Banking and the Economy.

Nigeria's Minister of Power, Chief Adebayo Adelabu, announced on Monday that the Federal Government will not extend the operational licences of underperforming electricity distribution companies (DisCos) when they expire in 2028.

Speaking at the 2025 Nigerian Economic Summit in Abuja during a session focused on the power sector titled "Uninterrupted Power Supply: The Industrial Imperatives," Adelabu attributed the nation’s continued electricity woes largely to the inefficiencies of the DisCos.

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FG to revoke licences of failing DisCos

Adelabu’s concern comes at a critical time for the power sector, which is grappling with severe financial challenges, epileptic electricity supply, and repeated national grid failures.

He noted that although the power sector faces several structural and legacy issues, distribution companies remain a critical barrier to progress.

He said:

“The distribution companies need to sit up. They are a major bottleneck in the sector, and the government is doing everything possible to ensure they meet expectations. Their licences will expire in two years, and there will be major reforms before any renewal."

It should be noted that a 2025 World Bank report has highlighted that Nigeria has the highest number of people without access to electricity, with 86.8 million individuals affected.

Adelabu stated that the government is preparing for a major overhaul of the sector, and licence renewals will be strictly performance-based.

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He added:

“Those that have not shown good faith, demonstrated technical expertise, proven financial strength and stability, or acted in the country’s best interest will be kicked out."

Adelabu emphasised that any company failing to demonstrate technical competence, financial capacity, or a commitment to national development will not be allowed to continue operating.

He said the FG is committed to ensuring universal metering over the next three to five years.

FG to clear debt owed to GenCos

Addressing the N4 trillion debt burden owed to power generation companies (GenCos) and gas suppliers, Adelabu revealed that President Bola Tinubu has approved a N4 trillion bond to settle verified obligations.

He also mentioned the introduction of a targeted subsidy system aimed at shielding low-income households while pushing toward full sector commercialisation.

Recall that the FG had earlier announced plans to build a new super power grid with the support of an $18.2 billion loan approved by the National Assembly.

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In related news, Legit.ng had earlier reported that Adelabu reaffirmed Tinubu’s commitment to providing uninterrupted electricity before the end of his administration.

Adelabu highlighted key achievements under the President's Renewed Hope Agenda, including increased generation capacity and sector reforms

He pledged continued collaboration with electricity distribution companies and generation companies to resolve the challenges in the power sector.

Source: Legit.ng