The federal government has ordered the sale of four of the 11 licenced electricity distribution companies (DisCos) in the country under the management of commercial banks and the Asset Management Corporation of Nigeria (AMCON), as it begins the process of unbundling the firms to increase efficiency and fix the worrying state of power in the country.
The Minister of Power, Mr Adebayo Adelabu, made this disclosure while playing host to the Senate Committee on Power, led by its Chairman, Mr Eyinnaya Abaribe, in Abuja on Monday.
Mr Adelabu stated that the privatisation of the firms would not be reversed, but stressed that the Discos would be broken into more efficient structures along state lines to be able to deliver on their mandates.
He also revealed that over 100 projects of the Transmission Company of Nigeria (TCN) have not been completed since 2001, a period of about 23 years.
“We are unbundling the Discos along state lines. Some of the Discos are too big for efficiency. They are too big for effectiveness. Ibadan Disco covers seven states. It is practically impossible for them to be efficient.
“So, we are rearranging and restructuring the Discos along state lines so that each state government will know the responsible Disco for their states. Also, the federal and state governments should start exercising their rights in the operation and management of the Discos because we still own 40 per cent of the firms.
“But we have left it for the private sector operators for too long and they have messed it up. So, the government must come back to take over its right in the Discos. We are also planning to franchise the unserved communities under the Discos.”
The energy companies to be sold off are the Abuja Electricity Distribution Company, the Benin Electricity Distribution Company, the Kaduna Electricity Distribution Company, and the Kano Electricity Distribution Company. They have been taken over by the lenders due to their inability to repay their debts.
The government stated that those who acquired the Discos when the firms were officially privatised in November 2013, lacked the required expertise and financial capacity to run the companies
