NERC Dissolves Kaduna DisCo Board Over N456.5bn Debt, Operational Failures
The Nigerian Electricity Regulatory Commission (NERC) has dissolved the board of directors of Kaduna Electricity Distribution Plc (KAEDC) over cumulative market obligations of approximately N456.5 billion and what it described as prolonged financial, operational and regulatory failures.
The regulatory intervention, contained in Order No. NERC/2026/086, titled “Order on the Regulatory Intervention in Kaduna Electricity Distribution Plc Pursuant to the Electricity Act 2023,” took effect on Monday, August 10, 2026.
NERC also appointed an interim board of special directors and ordered the commencement of a transparent process for the selection of a new core investor for the electricity distribution company.
According to the order, KAEDC’s cumulative market obligations stood at approximately N456.5 billion as of May 2026.
The debt includes about N415.5 billion owed to Nigerian Bulk Electricity Trading Plc (NBET) and N41 billion due to the Nigerian Independent System Operator.
The commission also identified non-market statutory and third-party obligations amounting to N14.26 billion.
NERC said the company’s financial crisis worsened after ASI Engineering Limited assumed control of KAEDC in June 2024, with the DisCo accumulating an additional N118.6 billion in market debt between then and May 2026.
The regulator attributed the company’s deteriorating position to prolonged market and regulatory defaults, inadequate investment, weak operational and commercial performance, insufficient assets relative to liabilities and the absence of a credible recovery plan.
NERC said KAEDC paid only 41.93 per cent of its adjusted market invoices in 2025, resulting in a market shortfall of approximately N46.71 billion.
The commission attributed the poor remittance performance largely to the company’s high aggregate technical, commercial and collection losses, which stood at 71.88 per cent in 2025.
This meant the company could account for only about 28.2 per cent of the electricity it received and delivered to end-use customers during the period under review.
The regulator also faulted KAEDC for failing to meet its capital investment obligations.
According to NERC, the company recorded actual capital expenditure of approximately N2.48 billion in 2025, against a minimum requirement of N24.51 billion, representing only about 10 per cent performance.
Meter coverage also remained low, ranging between 33.26 per cent and 35.54 per cent since ASI took over the company, despite interventions aimed at improving metering across the electricity distribution sector.
NERC said KAEDC’s poor performance persisted despite receiving significant regulatory and government support.
The company received approximately N6.58 billion in regulatory derogations between January 2024 and May 2026, while aggregate Federal Government intervention disbursements to the DisCo stood at approximately N53.79 billion since July 2018.
Despite the interventions, NERC said the company failed to demonstrate a sustainable turnaround.
The commission warned that KAEDC’s continued underperformance posed material risks to customers, creditors, market stability and continuity of electricity supply.
NERC said it had previously notified KAEDC’s major shareholders and Afrexim Bank about the impending intervention and requested a credible plan to address the company’s financial difficulties.
Representatives of ASI Engineering, NERC, the Bureau of Public Enterprises (BPE), Afrexim Bank and Fidelity Bank subsequently met on June 11, 2026, to consider proposals for rescuing the utility.
According to the commission, ASI had failed to comply with conditions attached to its acquisition of a 60 per cent majority shareholding in KAEDC and had not met BPE requirements for finalising the shareholding arrangements.
ASI later requested an extension of up to 24 months to stabilise KAEDC’s cash flow, undertake critical investments and improve market remittances.
NERC, BPE and Afrexim Bank, however, rejected the request, saying a further extension was not justifiable given ASI’s failure to deliver significant financial and operational improvements since taking effective control of the company in June 2024.
The commission consequently invoked its powers under Sections 75 to 79 of the Electricity Act 2023 to intervene in the affairs of KAEDC.
Under the order, NERC dissolved the company’s board and removed all directors from office.
The commission appointed seven special directors to constitute an interim board to oversee the company during the transition, with Dr Abdullahi Garba appointed as chairman.
NERC also retained the incumbent Managing Director/Chief Executive Officer, Dr Abubakar Umar Hashidu, as Administrator for an initial six-month period, subject to review.
The Administrator will oversee the day-to-day management of KAEDC, ensure continuity of electricity distribution services, implement resolutions of the interim board, comply with NERC directives and safeguard the company’s assets and records.
NERC said the intervention is aimed at preserving KAEDC as a going concern while facilitating a transparent transition to a credible core investor within 12 months.
The latest action marks the second major regulatory intervention in the affairs of Kaduna DisCo.
In January 2024, NERC dissolved the company’s board and appointed an administrator and special directors following what it described as pervasive failure and non-performance.
The regulator said the latest intervention was necessary to prevent KAEDC’s deteriorating financial position from further threatening electricity market stability and service continuity.
NERC said the process of selecting a new core investor would be transparent and focused on securing an investor capable of restoring the financial and operational viability of Kaduna DisCo.
