The Nigerian Electricity Regulatory Commission (NERC) has dissolved the board of Kaduna Electricity Distribution Plc (KAEDC) over the company’s N456.5bn cumulative market obligations and prolonged financial and operational challenges.
The regulator also appointed an interim board of special directors and directed the commencement of a transparent process for the selection of a new core investor for the electricity distribution company.
The decisions were contained in Order No. NERC/2026/086, titled “Order on the Regulatory Intervention in Kaduna Electricity Distribution Plc Pursuant to the Electricity Act 2023”, which took effect on Monday, August 10, 2026.
NERC said the intervention followed an inquiry and consultations with key industry stakeholders, including the Bureau of Public Enterprises, and was necessitated by KAEDC’s prolonged regulatory and market defaults, inadequate investment, and weak operational and commercial performance.
The commission said KAEDC’s cumulative market obligation since privatisation stood at approximately N456.5bn as of May 2026, comprising N415.5bn owed to the Nigerian Bulk Electricity Trading Plc and N41bn due to the Nigerian Independent System Operator.
The company also had other non-market statutory and third-party obligations amounting to N14.26bn, according to the regulator.
NERC said that since ASI Engineering Limited took over operations of KAEDC in June 2024, the company had accrued additional market debt of more than N118.6bn as of May 2026.
“The commission, following its inquiry and consultation undertaken with key industry stakeholders, including the Bureau of Public Enterprises, finds that Kaduna Electricity Distribution Plc is in a grave situation characterised by prolonged regulatory and market default, inadequate investment, weak operational and commercial performance, insufficient assets relative to liabilities, and inability to present a credible pathway to sustainable recovery,” the commission stated.
NERC said KAEDC paid only 41.93 per cent of its adjusted market invoices in 2025, resulting in a market shortfall of approximately N46.71bn during the year.
It linked the poor remittance performance to the company’s high aggregate technical, commercial and collection losses, which stood at 71.88 per cent in 2025.
The regulator explained that the losses meant KAEDC could account for only 28.2 per cent of the electricity it received and delivered to end-use customers during the review period.
NERC also said ASI failed to meet its capital injection commitments towards recapitalising the utility.
According to the commission, KAEDC’s actual capital expenditure in 2025 was approximately N2.48bn, against a minimum capital expenditure provision of N24.51bn, representing only 10 per cent performance.
The regulator further noted that KAEDC’s meter coverage had remained between 33.26 per cent and 35.54 per cent since ASI took over the company, despite several interventions aimed at supporting meter deployment across electricity distribution companies.
NERC said the company’s financial difficulties persisted despite approximately N6.58bn in regulatory derogations granted between January 2024 and May 2026, and aggregate Federal Government intervention disbursements of approximately N53.79bn since July 2018.
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