Representatives urged indebted DisCos to settle market obligations

The House of Representatives Electricity Committee has called on electricity distribution companies (DisCos) that have outstanding liabilities in the Nigerian Electricity Market to immediately repay their debts, warning that continued defaults could undermine the liquidity and long-term sustainability of the power sector.

The committee, chaired by Nwokolo Onyemaechi, filed the appeal on Thursday while observing a public hearing involving the Ibadan Electricity Distribution Company regarding unpaid market obligations, Events of Default and other compliance issues. The hearing, chaired by NISO Executive Director, Market Operations, Edmond Eje, was part of ongoing engagement with selected DisCos regarding their financial and regulatory responsibilities in the electricity market.

According to the committee, the affected distribution companies include Benin Electricity Distribution Company, Enugu Electricity Distribution Company, Ibadan Electricity Distribution Company, Jos Electricity Distribution Company, Kaduna Electricity Distribution Company, Port Harcourt Electricity Distribution Company and Kano Electricity Distribution Company. The statement read, “The affected DisCos are Benin Electricity Distribution Company (BEDC), Enugu Electricity Distribution Company (EEDC), Ibadan Electricity Distribution Company (IBEDC), Jos Electricity Distribution Company (JEDC), Kaduna Electricity Distribution Company (KAEDCO), Port Harcourt Electricity Distribution Company (PHEDC) and Kano Electricity Distribution Company (KEDCO).”

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Expressing concern over rising debt, the committee stressed that prolonged failure to meet market obligations could have serious consequences for the entire electricity value chain. “He expressed concern over the accumulation of market debt incurred by the affected DisCos, and noted that prolonged failure to meet financial obligations could adversely impact the liquidity and sustainability of the electricity market. He, therefore, called on IBEDC and other indebted DisCos to make every effort within their capacity to settle their obligations and strengthen compliance with regulations governing the electricity market,” the statement read.

After the hearing, members of the House Committee continued their oversight visit to the management of the Nigerian Independent Systems Operator. Managing Director and Chief Executive Officer of NISO, Engr Abdu Mohammed, welcomed the lawmakers and described the organization as a major outcome of the reforms introduced under the Electricity Act, 2023.

Mohammed said NISO had developed a five-year plan aimed at strengthening system operations, increasing electricity market activity, improving system planning and supporting efficient coordination of Nigeria’s electricity grid. He also called for continued cooperation between the National Assembly, NISO and other stakeholders in addressing the structural and financial challenges facing the Nigerian Electricity Supply Industry.

While praising lawmakers for drawing attention to the issue of market defaults, Mohammed said stronger liquidity would improve the ability of operators across the sector to meet their obligations and maintain their operations.

He called for continued legislative support and constructive oversight, and emphasized that collaboration among key institutions remains critical to stabilizing the national electricity grid and advancing efforts towards a more reliable and sustainable electricity supply for Nigerians.