Fidelia Soriwei, Abuja
The Nigerian Electricity Regulatory Commission has dissolved the board of Kaduna Electricity Distribution Plc (KAEDC) and ordered the appointment of an interim board following the company’s mounting financial and operational challenges, including cumulative market obligations of about N456.5 billion.
The regulatory action was announced in Order No. NERC/2026/086, which took effect on August 10, 2026. The commission also directed the commencement of a transparent process to secure a new core investor for the electricity distribution company within 12 months.
According to NERC, its decision followed an inquiry and consultations with key stakeholders, including the Bureau of Public Enterprises, which revealed persistent regulatory and market defaults, inadequate investment, and weak operational and commercial performance.
“The commission, following its inquiry and consultation undertaken with key industry stakeholders including the Bureau of Public Enterprises, finds that Kaduna Electricity Distribution Plc is in a grave situation characterised by prolonged regulatory and market default, inadequate investment, weak operational and commercial performance, insufficient assets relative to liabilities, and inability to present a credible pathway to sustainable recovery,” the commission stated.
NERC said KAEDC’s cumulative market obligations as of May 2026 included N415.5 billion owed to the Nigerian Bulk Electricity Trading Plc and N41 billion due to the Nigerian Independent System Operator. The company was also reported to have additional statutory and third-party obligations of N14.26 billion.
The commission noted that since ASI Engineering Limited assumed operational control of KAEDC in June 2024, the utility accumulated more than N118.6 billion in additional market debt without significant improvements in performance.
According to the regulator, KAEDC remitted only 41.93 per cent of its adjusted market invoices in 2025, creating a market shortfall of about N46.71 billion. It also recorded aggregate technical, commercial and collection losses of 71.88 per cent during the same period.
NERC further stated that ASI failed to meet recapitalisation commitments, while the company spent only about N2.48 billion on capital projects in 2025 against a required minimum of N24.51 billion. Meter coverage also remained largely unchanged despite industry-wide interventions.
“The continued underperformance therefore poses material risk to end-use customers, creditors, market stability and continuity of electricity service,” the commission stated.
NERC disclosed that meetings involving ASI, the Bureau of Public Enterprises, Afreximbank, Fidelity Bank and the commission were held in June 2026 to explore options for stabilising the utility. However, the regulator said stakeholders agreed that ASI had not fulfilled key conditions tied to its acquisition of a 60 per cent stake in the company.
The commission rejected ASI’s request for an extension of up to 24 months to improve operations, citing the absence of meaningful progress since the firm assumed control.
“The commission, BPE and Afrexim considered this request against the backdrop of ASI being in effective control of KAEDC since June 2024 without a corresponding improvement in the utility’s financial and operational performance, and determined that a further extension of comparable duration was not justifiable in view of the continuing risk to end-use customers and the market,” NERC stated.
Following the intervention, NERC appointed a seven-member interim board chaired by Dr Abdullahi Garba. The regulator also retained the Managing Director and Chief Executive Officer, Dr Abubakar Umar Hashidu, as administrator for an initial six-month period to oversee day-to-day operations and ensure service continuity.
In addition, Afreximbank was directed to coordinate an open and competitive process for the selection of a replacement core investor, with the preferred bidder to be presented to NERC for approval within 12 months.
