Power Minister Adebayo Adelabu says the government will not renew licences of underperforming DisCos after 2028.
He warned that only efficient, financially capable firms will remain as Nigeria reforms its power sector.
The Minister of Power, Chief Adebayo Adelabu, has warned that the Federal Government will not renew the licenses of any electricity distribution company (DisCo) that fails to meet its performance targets when their current licenses expire in 2028.
Speaking during a power sector session at the 2025 Nigerian Economic Summit in Abuja, Adelabu described inefficiency among distribution companies as one of the most serious obstacles to achieving stable power supply across Nigeria.
The session, themed “Uninterrupted Power Supply: The Industrial Imperatives,” brought together top energy stakeholders to discuss practical strategies for overcoming Nigeria’s long-standing electricity challenges.
Adelabu noted that while the power sector faces broader systemic problems, the poor performance of some DisCos continues to slow progress. “The distribution companies need to sit up,” he said. “They remain a major bottleneck in the sector. Their licenses will expire in two years, and there will be major reforms before any renewal. Those that fail to demonstrate technical competence, financial capacity, or genuine commitment to national development will be replaced.”
He also revealed that the Tinubu administration has approved a ₦4 trillion bond to clear verified debts owed to generation companies (GenCos) and gas suppliers part of efforts to address the sector’s liquidity crisis. “Alongside this, a targeted subsidy framework is being developed to protect vulnerable households and ensure long-term stability,” the minister said.
Adelabu further disclosed that upcoming reforms would include stricter performance standards, full metering of all households within three to five years, and possible restructuring of DisCo ownership to improve efficiency.
In their contributions, Azura Power CEO, Edu Okeke, and Nigeria LNG Limited Managing Director, Philip Mshelbila, urged the government to improve liquidity in the electricity market and adopt fair gas pricing to attract investment in power generation.
Participants at the summit agreed that restoring accountability and efficiency in power distribution remains central to achieving Nigeria’s goal of reliable, uninterrupted electricity supply.
