By Oluwakemi Kindness
The House of Representatives has approved a ₦248.6 billion financial relief and debt restructuring package for the Kano, Jos, and Ikeja Electricity Distribution Companies (DisCos).
This move announced on Thursday is aimed at stabilising Nigeria’s troubled power sector.
The decision followed the adoption of a report by the Public Accounts Committee, which reviewed the growing indebtedness of electricity distribution firms as captured in the Auditor-General’s report.
Debt Breakdown
The approved relief covers:
₦128.5 billion in accrued interest (2015–September 2025)
₦120 billion in historical debt
This brings the total liability addressed under the plan to ₦248.6 billion.
Lawmakers directed that the historical debt be restructured over a period of not more than 10 years.
Regulatory Intervention
The Nigerian Electricity Regulatory Commission had earlier directed the Nigeria Bulk Electricity Trading Company to:
Waive interest charges on debts incurred between 2015 and 2020
Apply interest only from 2021 onward
The regulator also ordered a recomputation of liabilities, including the disputed ₦128 billion interest component.
Sector-Wide Debt Crisis
Findings presented to lawmakers show that total debt owed by electricity distribution companies rose from ₦1 trillion in December 2024 to ₦1.3 trillion by September 2025, highlighting worsening liquidity challenges in the sector.
The investigation covered 11 DisCos and was aimed at verifying liabilities and identifying reasons for persistent payment defaults.
Government May Absorb Part of Debt
The committee further recommended that about ₦13.39 billion in liabilities linked to government intervention in Kano DisCo be transferred to the Nigerian Electricity Liability Management Company.
Lawmakers Raise Concern
Chairman of the committee, Rep. Bamidele Salam, warned that the electricity distribution sector could face deeper instability if urgent financial and regulatory measures are not sustained.
He urged all DisCos to comply strictly with market obligations to prevent further accumulation of debt.
Push for Sector Stability
The report noted that legacy debts, interest disputes, and structural constraints in the electricity market—such as restricted access to revenue through escrow arrangements—have contributed significantly to the financial strain on operators.
Lawmakers said the latest intervention is part of broader efforts to restore stability, improve liquidity, and support ongoing reforms in Nigeria’s power sector.
