Nigeria’s state governors are taking bold steps to address the chronic issue of power supply across the country. In a groundbreaking move, the governors have teamed up to break the monopoly of the existing electricity distribution companies, known as Discos. This unified effort is seen as a significant step towards providing consistent power to Nigeria’s 200 million-plus citizens.
In March 2023, the then-president, Muhammadu Buhari, signed into law a constitutional amendment allowing Nigerian states to license, generate, transmit, and distribute electricity. This landmark legislation has now paved the way for state governors to collaborate and seek expert guidance in tackling the power distribution challenge.
State governors have hired consultants to navigate the complexities of breaking the Disco monopoly. This move aligns with the new Electricity Act of 2023, signed into law by current President Bola Tinubu. The act aims to decentralize the power sector by allowing states, companies, and individuals to generate, transmit, and distribute electricity. This shift signifies a genuine restructuring of Nigeria’s electricity sector.
The Director General of the Nigeria Governors’ Forum (NGF), Asishana Okauru, explained that the NGF has set up a dedicated power desk, engaged consultants, and created a forum for Power Commissioners from the 36 states. “We have taken a leading and coordinating role in seeing to the implementation of the Electricity Act at the sub-national level,” he stated.
The initiative comes amid ongoing frustrations with the Discos’ performance, with the Minister of Power, Adebayo Adelabu, announcing plans to restructure the 11 existing Discos along state lines. The rationale is that some Discos are too large to operate efficiently, leading to poor service delivery and frequent power outages. Additionally, some Discos are under the management of banks and the Asset Management Corporation of Nigeria (AMCON) due to financial troubles.
Labour unions, such as the Nigerian Labour Congress (NLC) and the Trade Union Congress (TUC), have also weighed in, urging states to break the monopoly and calling for more accountability from the Discos. They have criticized the Discos for practices like estimated billing and lack of metering, which often lead to unfair charges for consumers.
The House of Representatives Committee on Power has expressed support for protecting consumers from arbitrary tariff hikes and ensuring a more reliable power supply. The committee plans to meet with Gencos and Discos to discuss issues surrounding the delay in the categorization of consumers and the implications of tariff increases.
Experts in the power sector have noted that the restructuring efforts could lead to more efficient power distribution and reduced costs for consumers. However, they caution that the capital-intensive nature of power generation will require substantial investment and strategic partnerships with private investors.
Despite these challenges, the move to decentralize the power sector and break the Discos’ monopoly is seen as a step in the right direction, promising a brighter future for Nigeria’s power supply and its economy.