Keypoints
- NERC dissolves Kaduna Electricity Distribution Plc board over prolonged financial and operational challenges.
- KAEDC’s cumulative market obligations stood at N456.5bn as of May 2026.
- Regulator appoints a seven-member interim board and administrator.
- Afrexim Bank tasked with coordinating a transparent search for a new core investor.
- NERC gives 12 months to complete the transition process.
Main Story
The Nigerian Electricity Regulatory Commission (NERC) has dissolved the board of Kaduna Electricity Distribution Plc (KAEDC) over cumulative market obligations of N456.5 billion and prolonged financial and operational challenges.
The decision, contained in Order No. NERC/2026/086, titled “Order on the Regulatory Intervention in Kaduna Electricity Distribution Plc Pursuant to the Electricity Act 2023,” took effect on Monday, August 10, 2026.
NERC said the intervention followed an inquiry and consultations with key stakeholders, including the Bureau of Public Enterprises (BPE), and was driven by KAEDC’s prolonged regulatory defaults, inadequate investment, weak operational performance and worsening financial position.
According to the regulator, KAEDC’s cumulative market obligations stood at approximately N456.5 billion as of May 2026, comprising N415.5 billion owed to the Nigerian Bulk Electricity Trading Plc and N41 billion due to the Nigerian Independent System Operator. The company also had N14.26 billion in other statutory and third-party obligations.
The commission said the company had accumulated an additional N118.6 billion in market debt since ASI Engineering Limited assumed control of its operations in June 2024, despite expectations that the takeover would improve its financial and operational performance.
NERC further disclosed that KAEDC paid only 41.93 per cent of its adjusted market invoices in 2025, resulting in a market shortfall of about N46.71 billion. It attributed the poor remittance performance largely to aggregate technical, commercial and collection losses of 71.88 per cent recorded during the year.
The regulator also faulted the company’s investment performance, saying it recorded only N2.48 billion in capital expenditure in 2025, against a minimum requirement of N24.51 billion. This represented just 10 per cent performance. Meter coverage also remained between 33.26 per cent and 35.54 per cent despite interventions to improve metering.
The Issues
NERC said KAEDC’s financial difficulties persisted despite about N6.58 billion in regulatory derogations granted between January 2024 and May 2026 and approximately N53.79 billion in Federal Government intervention funds disbursed since July 2018.
The commission warned that the company’s continued underperformance posed risks to electricity consumers, creditors, market stability and continuity of power distribution, describing its financial condition as a potential systemic risk to the Nigerian Electricity Supply Industry.
NERC also said ASI Engineering failed to meet its capital injection commitments and did not comply with conditions attached to its acquisition of a 60 per cent majority stake in KAEDC.
What’s Being Said
NERC said KAEDC had been in a “grave situation” characterised by prolonged defaults, inadequate investment, weak operational and commercial performance and insufficient assets relative to its liabilities.
The commission said further delay in addressing the situation could lead to “disruptive cessation of distribution services”, making regulatory intervention necessary to protect consumers and other stakeholders.
What’s Next
As part of the intervention, NERC dissolved the KAEDC board and removed all its directors from office. It appointed a seven-member interim board of special directors headed by Dr Abdullahi Garba.
The commission also appointed the incumbent Managing Director/Chief Executive Officer, Dr Abubakar Umar Hashidu, as administrator for an initial six-month term to oversee daily operations, ensure continuity of electricity services and safeguard the company’s assets and records.
NERC directed Afrexim Bank to coordinate an open, competitive and transparent process for selecting a replacement core investor for KAEDC. The preferred investor is expected to be presented to NERC for approval, with the process to be completed within 12 months unless the commission grants a written extension.
Bottom Line
NERC’s intervention marks a major regulatory action against KAEDC after years of mounting debt, weak remittances and inadequate investment. The regulator says the measures are aimed at preserving the distribution company as a going concern, protecting electricity consumers and facilitating its transition to a financially and operationally credible core investor.
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