Reps  Okay  N248.6bn Relief, 10-year Debt Restructuring For Kano, Jos, Ikeja DisCos

The House of Representatives Public Accounts Committee has approved a comprehensive financial relief package and a 10-year debt restructuring plan for the Kano, Jos and Ikeja Electricity Distribution Companies (DisCos).

The move, the Green Chamber said is aimed at stabilising Nigeria’s troubled power sector and easing the burden of legacy debts.

The decision followed the adoption of a report by a technical subcommittee set up to review findings from the 2021 Auditor-General for the Federation’s report on the mounting liabilities of electricity distribution companies, as escalated by the Nigeria Bulk Electricity Trading Company Plc (NBET).

Under the approved framework, the three DisCos will benefit from a restructuring of their historical obligations alongside a waiver of accrued interest in debts accumulated over the past decade.

The combined liabilities, covering both principal and interest had risen significantly over the years, prompting legislative intervention to prevent further strain on the electricity market.

Chairman of the technical subcommittee, Hon. Mark Chidi Obetta, said the recommendation forms part of broader efforts by the National Assembly to address longstanding financial distortions in the sector and ensure its sustainability.

He noted that unresolved legacy debts and disputed interest charges have continued to weaken the operational capacity of distribution companies.

Findings presented to the committee showed that the total indebtedness of the eleven DisCos under review had grown substantially within a short period, driven largely by accumulating interest and persistent non-settlement of market invoices.

The investigation was designed to verify the Auditor-General’s claims, determine the current debt profile of the companies, and identify the factors responsible for their continued inability to meet financial obligations.

The Jos, Ikeja and Kano DisCos argued that the prevailing Market Rules did not explicitly provide for such charges, raising concerns about the transparency and fairness of the billing framework.

In response, the Nigerian Electricity Regulatory Commission (NERC) issued a directive in January 2026 instructing NBET not to apply interest on outstanding invoices covering the period between 2015 and 2020, while permitting interest charges only from 2021 onward.

The regulator also directed that any interest linked to delays involving MERISTEM, a financial intermediary introduced to manage liquidity challenges in the sector, should be disregarded.

Following this directive, NBET was asked to recompute the liabilities of the affected DisCos, including previously accrued interest.

The committee subsequently endorsed a waiver of these interest obligations and approved a structured repayment plan for the outstanding principal over a period not exceeding 10 years.

The report further highlighted that a significant portion of Kano DisCo’s liabilities was incurred during periods of government intervention and receivership.

It recommended that such obligations be reviewed and transferred to the Nigerian Electricity Liability Management Company (NELMCO), in line with existing precedents within the sector.

The committee emphasised that the current electricity market structure where revenues are managed through escrow arrangements and prioritised for market settlements limits the ability of DisCos to recover costs, including the inability to charge interest on unpaid bills to customers, particularly government agencies.