Poor power supply: Azura boss urges FG to remove legacy debts from DisCos books
The Managing Director, Azura Power West Africa Limited, Edu Okeke, has urged the Federal Government to consider removing the huge legacy debts from the books of electricity distribution companies, DisCos, and mandate them to increase their capital to at least $500 million each.
Okeke who spoke in Abuja at the 2024 Power Correspondents Association of Nigeria, PCAN, annual workshop, said the move would require existing shareholders to dilute their holdings to attract new investors with real capital to invest in infrastructure — not just on paper, but in transformers, cables, and equipment to serve customers reliably.
The fourth edition of the PCAN workshop had the theme: Nigerian Power Sector: Ending the Talk, Moving to Action.
Okeke said: “To enable meaningful progress, DISCOs must be adequately capitalized. Unfortunately, most DISCOs have negative equity, leaving them with little to no financial stake. This situation must change. Ideally, no DISCO should operate without at least USD 250m in shareholder funds.
“Just as the Central Bank of Nigeria has raised capital requirements for banks to ensure their stability and capacity to serve, the Nigerian Electricity Regulatory Commission (NERC) should mandate similar capitalization standards for DISCOs.
“Many DISCOs also carry a heavy burden of debt, accumulated over time through a mix of operational challenges and systemic issues. To truly address this problem, the Government needs to come clean and take a decisive step”, he added.
Speaking at the event, the Minister of Power, Chief Adebayo Adelabu reaffirmed the Federal Government’s commitment to complete the reform of the power to ensure 24 hours power supply.
Adelabu who was represented by the Director, Renewable and Rural Power Access, Dr Sunday Owolabi, noted that the industry has reached a pivotal moment where actions are required.
“We are focused on ensuring that our policies are not only visionary but also practical, impactful, and sustainable. From the ongoing efforts to address infrastructure gaps, enhance power generation, and improve transmission networks, to the vital reforms in distribution and the full implementation of the electricity market, we are resolute in our mission to improve the power supply for every Nigerian”.
On his part, the Managing Director, Nigerian Electricity Management Services Agency, NEMSA, Engr. Aliyu Tahir said the agency would continue to ensure that every Nigerian has access to safe electricity, and to protect lives and property by upholding quality standards in the sector.
He pointed out that this year has seen various challenges and milestones in our sector, from the rapid expansion of infrastructure to the modernization efforts aimed at enhancing operational efficiency and safety across the country.
“NEMSA has been proactive in addressing these challenges, and we have made significant strides in electrical safety and quality management to support the stability and reliability of our power systems. Our mandate is clear: to ensure that every Nigerian has access to safe electricity, and to protect lives and property by upholding quality standards in the sector”, he added.
Earlier in his welcome address, Chairman of PCAN, Mr. Obas Esiedesa observed that despite modest gains made by the operators of the sector the recent spate of national grid collapses as well as the slow rate of electricity meter deployment have raised concerns about the viability of the power sector.
He stated: “Our concerns are heightened by the fact that these issues persist despite the Service-Based Tariff and the increased tariffs for Band A customers. Although the meter market has been deregulated, progress in metering remains limited”.
