The Nigerian Electricity Regulatory Commission has taken over Kaduna Electricity Distribution Company, dissolving its board of directors over a mounting debt crisis that has left the utility owing about N456.5 billion in cumulative market obligations.
The regulator announced the intervention in a regulatory order issued on 10 August 2026, saying the decision was taken to preserve the utility as a going concern and ensure continuity of electricity distribution services across Kaduna DisCo’s network area.
The move follows months of worsening financial and operational challenges at the utility, with NERC citing persistent market defaults, weak collections, high technical and commercial losses, and the failure of the company’s core investor to provide a credible recovery plan.
NERC said that since ASI Engineering Limited took over operations as the core investor in June 2024, Kaduna DisCo accumulated an additional N118.6 billion in market debt by May 2026.
The commission added that the company and its core investor repeatedly failed to provide acceptable payment guarantees required under electricity market rules and did not present a credible plan for settling the liabilities.
NERC said it had resolved to dissolve Kaduna DisCo’s board and intervene in the company to stabilise operations while pursuing a transparent transition to a new core investor within the next 12 months.
The commission stated: “Further to the meeting of 11 June 2026, the Commission resolved to exercise its powers conferred under sections 75 – 79 of the EA to dissolve the board of directors of KAEDC by intervening to preserve the undertaking as a going concern and achieve a transparent transition to a credible core investor within 12 months.”
As part of the intervention, NERC said it was acting in the public interest to safeguard electricity distribution services by dissolving the existing board, appointing special directors as an interim board, withdrawing regulatory approvals previously granted to the management team, retaining the current Managing Director as Administrator for an initial six-month period, and commencing a supervised process to secure a technically competent and financially capable replacement core investor.
The order specifically provides for the dissolution of the board, the withdrawal of key management approvals, and the appointment of an administrator and special directors to oversee the affairs of Kaduna DisCo during the intervention period.
NERC said Kaduna DisCo’s financial position had deteriorated sharply, with cumulative market obligations reaching N456.5 billion as of 31 May 2026.
The debt comprises N415.5 billion owed to the Nigerian Bulk Electricity Trading Plc (NBET) and N41 billion owed to the Nigerian Independent System Operator (NISO), in addition to N14.26 billion in other statutory and third-party obligations.
The commission said the utility’s debt burden worsened after ASI Engineering Limited assumed operational control in June 2024, with the company accumulating an additional N118.6 billion in market debt within two years.
NERC also faulted Kaduna DisCo and its core investor for repeatedly failing to provide acceptable payment guarantees to NBET and NISO as required under electricity market rules, while also failing to submit a credible repayment plan for the outstanding liabilities.
According to the regulator, the company paid only 41.93 per cent of its adjusted market invoices in the review period ending 31 December 2025, leaving a N46.71 billion market payment shortfall.
The commission linked the weak remittance performance to Kaduna DisCo’s Aggregate Technical, Commercial and Collection (ATC&C) losses of 71.88 per cent, which meant the utility was able to account for only 28.2 per cent of the electricity it received and delivered to customers during the 2025 review period.
The intervention marks the culmination of a series of financial and governance problems that have trailed Kaduna DisCo over the past two years.
In July 2024, NERC approved the acquisition of a 60 per cent equity stake in Kaduna Electricity Company Plc by ASI Engineering Limited, paving the way for the new investor to take operational control of the utility.
However, the company soon became embroiled in a series of debt-related disputes.
In August 2024, the Kaduna State Internal Revenue Service sealed the company’s office over alleged unpaid tax liabilities of about N600 million.
The same month, Kaduna DisCo announced that it had disconnected electricity supply to the Kaduna State Government House over an outstanding electricity debt of N2.9 billion.
Nairametrics has reported extensively on the financial pressures facing electricity distribution companies, including rising market debts, weak remittance performance, and regulatory efforts to improve governance and investment across the power distribution segment.
NERC’s latest intervention signals a more aggressive regulatory approach toward underperforming distribution companies, with Kaduna DisCo becoming one of the clearest cases of a utility placed under direct regulatory restructuring to restore financial stability and operational viability.
