The federal government has launched an ambitious initiative to transform Nigeria’s struggling electricity distribution sector, beginning with a pilot overhaul of two underperforming Distribution Companies (DisCos). This significant move follows a comprehensive evaluation of the systemic issues that have long plagued the DisCos, including governance gaps, aging infrastructure, and commercial inefficiencies that hinder reliable service delivery.
Power Minister Chief Adebayo Adelabu unveiled the reform strategy after a crucial meeting with the Japanese International Cooperation Agency (JICA) in Abuja. The meeting included a presentation of a detailed roadmap titled “Revamping the Distribution Sector in Nigeria.”
In a press statement released by his Special Adviser for Strategic Communications and Media Relations, Mr. Bola Tunji, it was revealed that the pilot scheme is set to launch between May and August 2025, targeting one DisCo in the North and another in the South. This initiative aims to create a replicable model for operational turnaround, integrating internal restructuring with external expertise and enhanced federal oversight to deliver swift improvements in service delivery.
The proposal from JICA proposes a unique approach to reforming the DisCos from within by bringing in outside experts, strengthening leadership, and ensuring that government support is aligned with short-term objectives in select pilot zones—this, in turn, aims to lay the groundwork for long-term, sector-wide transformation.
Minister Adelabu stressed the urgency of this intervention, declaring, “We can no longer fold our hands and watch the inadequacies of DisCos whose performances fall short of expectations. This pilot is not optional—we will utilize regulatory authority to restructure underperforming DisCos and compel compliance if necessary.”
He also acknowledged the staggering debt of over N4 trillion owed to DisCos, highlighting this as a major challenge to progress. Adelabu noted that the DisCos’ failure to invest in infrastructure is a significant drawback to improving electricity supply. “Their lack of investment is not solely due to unwillingness but also a lack of incentives. The returns on infrastructure spending are often not commensurate, which is why attracting investors is crucial,” he elaborated.
To strengthen this initiative, he has directed the Nigeria Electricity Regulatory Commission (NERC) to enforce franchising opportunities and ensure the cooperation of DisCos. “NERC must secure their buy-in. Past efforts have faltered due to resistance, but this time, we will be intentional and decisive,” he affirmed.
The Minister also emphasized the importance of public education to clarify the distinct roles of generation, transmission, and distribution within the sector. “Many Nigerians still misconstrue the sector as a singular entity. Educating consumers is critical to building trust and garnering support for these reforms,” he added.
JICA’s proposal, developed following the Minister’s visit to Japan’s energy market, outlines a “holistic approach” to revitalizing distribution, which includes proactive collaboration between the government and JICA, along with measurable milestones. Takeshi Kikukawa, JICA’s Power Sector Policy Advisor to Nigeria, expressed that “the goal is to deliver immediate results in pilot areas while creating a sustainable foundation for nationwide improvement.”
The Federal Ministry of Power, along with NERC, will finalize pilot details in the upcoming months, prioritizing DisCos with pressing operational deficits. This initiative represents the most robust effort to date aimed at resolving the ongoing power distribution crisis, signaling a renewed commitment to accountability, investor confidence, and ultimately, reliable electricity access for all Nigerians.