The Minister of Power, Chief Adebayo Adelabu, has announced that the Federal Government will not renew the licenses of electricity distribution companies (DisCos) that fail to meet performance standards when their current licenses expire in 2028.
Speaking at the Nigerian Economic Summit 2025 in Abuja during a session focused on the power sector, Adelabu highlighted that inefficiency within the DisCos remains a major barrier to achieving stable electricity supply nationwide. The session, titled “Uninterrupted Power Supply: The Industrial Imperatives,” brought together key industry stakeholders to explore solutions to Nigeria’s longstanding energy challenges.
Adelabu stressed that while the power sector faces systemic issues, the poor performance of the DisCos continues to hinder progress. “The distribution companies need to sit up,” he said. “They are a major bottleneck in the sector, and the government is doing everything possible to ensure they meet expectations. Their licenses will expire in two years, and significant reforms will be implemented before any renewal. Those who have not demonstrated technical expertise, financial stability, or commitment to national interest will be replaced. The government is also committed to ensuring that every household is metered within the next three to five years.”
Addressing the sector’s liquidity crisis, Adelabu revealed that President Bola Tinubu has approved a ₦4 trillion bond to clear verified debts owed to power generation companies (GenCos) and gas suppliers. “To stabilize the market, the President has approved this bond to settle verified GenCo and gas supply debts. Additionally, a targeted subsidy framework is being developed to protect vulnerable households and secure the sector’s long-term viability,” he explained.
In related remarks, Azura Power CEO Edu Okeke and Nigeria LNG Managing Director Philip Mshelbila emphasized the need for improved liquidity and more efficient gas pricing to attract investment in electricity generation. Okeke noted that concerns over gas pricing in dollars are less significant than other structural challenges, while Mshelbila stressed that fair gas pricing would encourage more investment in gas supply, which underpins Nigeria’s power generation capacity.
The session concluded with a consensus among stakeholders that restoring efficiency and accountability in power distribution is essential to achieving Nigeria’s goal of uninterrupted electricity supply.
Adelabu added that upcoming reforms will include enforcing stricter performance standards, expanding metering coverage, and restructuring DisCo ownership where necessary to ensure consumers receive reliable and efficient service.
