The Federal Government may re-privatise the 11 electricity distribution companies (Discos) across Nigeria if they fail to recapitalise within 12 months, following sweeping regulatory reforms proposed in the Electricity Act (Amendment) Bill, 2025.
The amendment bill, sponsored by Senator Enyinnaya Abaribe (Abia South) and currently under review in the National Assembly, seeks to overhaul the Electricity Act of 2023 by addressing performance failures and financial instability within the Nigerian Electricity Supply Industry (NESI).
If passed into law, the Nigerian Electricity Regulatory Commission (NERC) will be empowered to enforce recapitalisation within 12 months, dilute investors’ shares, place underperforming Discos under receivership, and re-privatise non-compliant companies.
According to the draft bill, Discos under financial distress or receivership will face mandatory recapitalisation or regulatory sanctions. The amendment outlines a 12-month window to develop a financing framework focused on de-risking investments, phasing out unstructured subsidies, and attracting long-term local currency for gas-to-power and distributed energy projects.
Currently, Nigeria’s 11 Discos include Abuja, Benin, Eko, Enugu, Ibadan, Ikeja, Jos, Kaduna, Kano, Port Harcourt, and Yola Electricity Distribution Companies. Many of these have failed to meet performance benchmarks despite receiving government bailouts and tariff adjustments.
The Minister of Power, Adebayo Adelabu, who previously decried the poor service delivery of the Discos, confirmed that the government will no longer tolerate excuses. “If you can’t invest, give way to those who can,” he said.
While the bill has sparked optimism among energy reform advocates, it has also drawn criticism from power experts and stakeholders who fear a rushed implementation could destabilise the decentralised electricity market.
Chinedu Amah, an electricity market analyst, warned against “policy overload” and called for consistent implementation rather than constant reforms. Habu Sadiek, another analyst, advocated for a 24-month recapitalisation period and immediate clearance of subsidy debts before enforcing compliance.
The Forum of Commissioners of Power and Energy has also raised concerns, cautioning that the bill could reverse progress made under the 2023 Act.
Meanwhile, sources within the power distribution sector say they are open to collaboration. “We believe in the National Assembly’s wisdom. The law, once passed, will be binding,” a Disco official stated.
With the bill at committee stage in the National Assembly, all eyes are now on the presidency and NERC as Nigerians await the potential transformation or further turbulence of the nation’s troubled power sector.
