DisCos face N500bn recapitalization requirement, as Reps push for power sector overhaul

Nigeria’s House of Representatives has taken a bold step to address the nation’s electricity woes by mandating distribution companies (DisCos) to undergo a N500 billion recapitalization.

This move aims to enhance their financial stability and ensure they can efficiently meet their obligations to the Nigerian public.

The resolution was sparked by a motion titled “Need to Address the Activities of Distribution Companies in Nigeria,” sponsored during plenary on Wednesday by Ayokunle Isiaka, representing the Ifo/Ewekoro Federal Constituency of Ogun State.

Isiaka highlighted the significant threat posed by DisCos’ recent actions to the nation’s economic stability and the welfare of Nigerians.

“The House notes that Nigerian consumers paid for electricity meter installation, but DisCos are demanding additional payments for the replacement of these meters under dubious pretences, undermining consumer trust and exacerbating financial burdens,” Isiaka said.

READ ALSO: Teenager brutalized, locked in dog cage by father, brothers of female classmate he visited

He also expressed concern over the ‘Sabotage of Economic Development’ by DisCos, where essential services are used against citizens, stifling growth and development.

“The House is concerned that consumers are being coerced into paying for meters they have already financed, putting additional financial strain on households and businesses already facing economic challenges.”

Speaker Tajudeen Abbas emphasized that only DisCos with the required financial capacity should continue operating, urging them to undergo recapitalization of at least N500 billion. The House directed the Federal Ministry of Power to declare DisCos as non-state actors and address their reckless actions threatening the nation’s economy.

Furthermore, the House Committee on Power will investigate DisCos’ activities to hold them accountable and safeguard consumer rights. They will also conduct awareness campaigns on consumers’ rights and examine the implementation of strict regulations governing DisCos to ensure transparency and fairness.

This move is not unprecedented, as experts have long advocated for recapitalization. Olu Verheijen, an adviser to President Bola Tinubu on energy, had once noted that Nigerian electricity companies require an estimated N2 trillion ($2.5 billion) in capital to revive the industry.

The post DisCos face N500bn recapitalization requirement, as Reps push for power sector overhaul appeared first on Latest Nigeria News | Top Stories from Ripples Nigeria.