By Christiana Ekpa
The House of Representatives Public Accounts Committee has approved financial relief measures and a 10-year debt restructuring framework for the Kano, Jos and Ikeja Electricity Distribution Companies (DisCos), in a move aimed at stabilising Nigeria’s power sector.
The relief package covers accrued interest on debts from 2015 to September 2025 amounting to N128.58 billion, alongside historical debts of N120.06 billion, bringing the combined liability to N248.64 billion.
The resolution followed the adoption of a report by a technical subcommittee reviewing findings in the 2021 Auditor-General for the Federation’s report on the rising indebtedness of electricity distribution companies to the Nigeria Bulk Electricity Trading Company (NBET).
Chairman of the subcommittee, Hon. Mark Chidi Obetta, said the recommendations form part of legislative efforts to address legacy liabilities and restore financial stability in the electricity market.
The committee noted that total indebtedness across 11 DisCos rose from about N1 trillion as of December 31, 2024 to N1.3 trillion by September 25, 2025, driven by accumulating principal and interest obligations.
According to the report, Abuja DisCo recorded the highest debt exposure at N275.17 billion, followed by Kaduna (N303.81 billion), Jos (N104.38 billion), Ibadan (N103.41 billion) and Kano (N96.62 billion), among others, bringing total outstanding liabilities to N1.304 trillion.
The investigation, the committee said, sought to verify claims by the Auditor-General, reconcile current debt positions and determine reasons for persistent payment defaults by the DisCos.
A key issue during the hearings was the dispute over interest charges, with Jos, Kano and Ikeja DisCos challenging their legitimacy, arguing that the Market Rules did not explicitly provide for such charges.
In response, the Nigerian Electricity Regulatory Commission (NERC), in a January 2026 directive, instructed NBET not to charge interest on outstanding invoices between 2015 and 2020, but to apply interest from 2021 onward.
The regulator also directed that any interest linked to delays involving MERISTEM be disregarded, and ordered NBET to recompute liabilities, including the disputed N128 billion interest component.
The committee recommended that NBET and NERC allow Kano, Jos and Ikeja DisCos to restructure and repay their historical debts over a period not exceeding 10 years
It further advised that liabilities incurred during periods of government intervention, including N13.4 billion attributed to Kano DisCo, be transferred to the Nigerian Electricity Liability Management Company (NELMCO), in line with existing sector precedents.
The lawmakers also urged NERC to direct NBET to waive all accrued interest from 2015 to September 2025 for the three DisCos, citing sector-wide liquidity challenges and structural constraints in the electricity market.
They noted that the current market structure, including escrow arrangements, limits DisCos’ access to revenue and prevents them from charging corresponding interest on unpaid bills by customers, including government agencies.
The committee warned that failure to implement urgent financial restructuring and enforce regulatory compliance could further threaten the sustainability of the power distribution sector.
Chairman of the committee, Rep. Bamidele Salam, called on all DisCos to strictly meet their market obligations going forward to prevent a further build-up of debt.
