DisCos Groan As MDAs Delay Electricity Payments

The Association of Nigerian Electricity Distributors (ANED) has raised concerns over the delayed payment of electricity bills by Ministries, Departments and Agencies (MDAs), saying the situation is worsening the financial strain on Distribution Companies (DisCos).

ANED’s Managing Director and Chief Executive Officer, Mr Sunday Oduntan, made this known in an interview with the News Agency of Nigeria (NAN) on Wednesday in Abuja.

Oduntan urged the Federal Government to treat electricity debts owed by government institutions as a direct first-line charge on approved budgets to ensure timely settlement.

He also called for measures to empower DisCos to disconnect government agencies that fail to pay their bills and pursue lawful recovery of outstanding debts.

“DisCos need to be empowered to disconnect government agencies that fail to settle their electricity bills and pursue lawful recovery of outstanding debts,” he said.

Oduntan further stressed the need for affordable, long-term financing to support the survival, expansion and modernisation of Nigeria’s electricity distribution network.

He called for improved customer service and greater transparency in electricity billing, while advocating the expansion of mini-grid and off-grid solutions, particularly in rural and underserved communities.

According to him, stronger accountability mechanisms are also needed to enable electricity consumers and civil society organisations to hold DisCos accountable for service delivery.

Oduntan said improved metering, stronger revenue collection, affordable financing and greater accountability would be critical to strengthening the financial sustainability of the distribution sector and improving electricity supply nationwide.

The development comes amid growing concerns over the wider liquidity crisis in Nigeria’s electricity market, with legacy debts owed to power generation companies (GenCos) reportedly reaching about N7tn.

Gas suppliers have also reportedly rejected the Federal Government’s proposal for a 50 per cent debt write-off.

The Federal Government had earlier approved a N3.3tn financial settlement plan to clear legacy debts accumulated within the Nigerian Electricity Supply Industry (NESI) between 2015 and early 2025.

Under the plan, outstanding obligations to GenCos were to be settled through 10-year promissory notes and the proceeds from an N501.02bn bond issued by the Nigerian Bulk Electricity Trading Plc (NBET).

The bond represents the first phase of efforts to address market shortfalls that have constrained investment and threatened the financial stability of the power sector.