Electricity Distribution Companies (DisCos) in Nigeria will now be required to meet a minimum capital adequacy requirement before their operating licences can be renewed.
This new policy, announced by the Minister of Power, Chief Adebayo Adelabu, during the opening of Nigeria Energy Week 2025 in Lagos.
It is aimed at addressing the persistent issue of under-capitalisation and debt burden among DisCos.
According to Adelabu, the measure will help strengthen the financial health and liquidity of the utilities.
The Minister explained that the government’s goal is to make the sector more financially stable and attractive to investors.
He revealed that before the reforms introduced by President Bola Tinubu’s administration, Nigerians spent about ₦15 trillion annually on diesel and fuel to power their generators due to unreliable electricity supply.
However, he noted that recent improvements have begun to change this narrative, with power generation now averaging 5,300MW in 2024, up from 4,200MW in 2023.
Adelabu also confirmed that contracts for the Presidential Power Initiative (PPI) Phase One have been signed,
Also, he disclosed that the Presidential Metering Initiative has secured ₦700 billion to deploy 1.1 million meters nationwide by the end of 2025.
In addition, the government has completed the unbundling of the Transmission Company of Nigeria (TCN) into two new entities
The Nigerian Independent System Operator (NISO) will oversee electricity market operations,
Also, the Transmission Service Provider (TSP), responsible for maintaining and expanding transmission infrastructure.
Adelabu appealed to private investors to take advantage of emerging opportunities within the sector.
The Minister also emphasised the significance of recent legislative reforms.
These includes the Electricity Act 2023 and the Integrated National Electricity Policy.
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He added that 15 states have now gained regulatory autonomy to establish subnational electricity markets.
