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Electricity Act (Amendment) Bill: FG may sell 11 Discos to new investors

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The Federal Government may sell the 11 power distribution companies through a re-privatisation process if the Electricity Act (Amendment) Bill, 2025, currently before the National Assembly, becomes law.

The National Assembly has already initiated a legislative process to enforce sweeping reforms that could see core investors in electricity distribution companies lose their stakes if they fail to improve their investment.

The amendment bill, sponsored by Senator Enyinnaya Abaribe (Abia South), seeks to overhaul the 2023 Electricity Act by addressing regulatory gaps, as it warned that investors risk losing their stakes through share dilution, receivership, or outright re-privatisation if fresh capital is not injected into the sector within 12 months, following years of poor performance and a worsening debt crisis.

This clause comes into effect immediately after an assent is granted to the ongoing amendment of the Electricity Act 2023. The bill has passed its second reading and is currently undergoing further legislative action and discussions.

If passed into an Act, it will empower the Nigerian Electricity Regulatory Commission to compel core investors in the 11 successor Discos to inject fresh capital or face stiff regulatory action, including share dilution, receivership, or outright re-privatisation.

This was disclosed in the draft amendment to the Principal Act, seen by The PUNCH, on Monday. The proposed Electricity Act (Amendment) Bill, 2025, has already attracted condemnation from the Forum of Commissioners of Power and Energy, warning that the bill poses a serious threat to the country’s newly decentralised electricity market and could reverse key reforms achieved under the landmark Electricity Act of 2023.

The bill also gives the commission powers to impose sanctions, including dilution of shares or re-privatisation, on defaulting Discos, particularly those under receivership or financial distress.

The PUNCH reports that there are 11 Discos in Nigeria that service different regions across the country. They include Abuja Electricity Distribution Company, Benin Electricity Distribution Company, Eko Electricity Distribution Company, Enugu Electricity Distribution Company, and Ibadan Electricity Distribution Company.

Others are Ikeja Electricity Distribution Company, Jos Electricity Distribution Company, Kaduna Electricity Distribution Company, Kano Electricity Distribution Company, Port Harcourt Electricity Distribution Company, and Yola Electricity Distribution Company.

Under the new law, a comprehensive framework must be developed within 12 months to overhaul the financial structure of the Nigerian Electricity Supply Industry, with a strong focus on attracting long-term local currency investments and phasing out what the bill describes as “unstructured and regressive subsidies.”

According to Sections 228J and 228K of the amended Act, the Minister of Power, in consultation with NERC, is required to develop and implement a robust financing framework aimed at de-risking investments across the power value chain and resolving the sector’s chronic debt overhang, estimated at over N4tn.

However, power sector experts and consumer advocacy groups have argued that the proposed law, if passed, can only be effectively implemented if the long-standing subsidy debts crippling the sector are first cleared.

They also recommend extending the recapitalisation deadline to 24 months, similar to the approach adopted during the banking sector recapitalisation, to allow for a more realistic and structured transition.

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A copy of the amended act read, “Financing of Projects in the NESI: The Federal Government shall, through the minister and in consultation with the Nigerian Electricity Regulatory Commission, establish a comprehensive framework for financing of projects in the NESI within 12 months from the commencement of this Bill.

“The framework referred to under subsection(1) of this section shall give regard to the extant National Electricity Policy and Strategic Implementation Plan and aim to attract and de-risk investments across the power value chain from generation, transmission, distribution, reduce diesel and petrol-based self-generation and address crippling financial crisis and debt overhang in the Nigerian power sector.”

The proposed Act stipulates that the new financing framework must prioritise long-term local currency financing for gas-to-power and distributed energy projects, a transparent and predictable tariff regime that guarantees cost recovery, the recapitalisation of Discos under NERC’s supervision, a clear determination of federal and state equity stakes in the Discos, and the provision of fiscal and tax incentives to attract investment and avert a sector collapse.

It noted, “The framework established under section 228I of this Bill shall include, but not limited to the following: long-term local currency capital financing for gas-to-power optimisation projects; distributed energy projects, etc, to mitigate foreign exchange risks for investors;

“Commitment to a transparent and predictable tariff regime that allows for cost recovery for efficient operators, progressively phasing out regressive and unstructured subsidies.

“Concession of certain power plants under the portfolio of the Niger Delta Power Holding, as well as commencement and completion of successor Discos’ recapitalisation to be implemented through the directive and supervision of the Nigerian Electricity Regulatory Commission.”

It further stated that the regulatory commission shall have the power to direct the core investors in the 11 successor distribution companies, including those under receivership, to recapitalise their respective equity holdings within such a time frame not exceeding 12 months from the commencement of this bill, and in deserving circumstances impose appropriate sanctions for non-compliance with its directive under this subsection, including an order for dilution of such shares held by core investors or re-privatisation.

It added, “A determination of Federal Government equity stakes in the 11 successor distribution companies with a clear timeframe of not later than 12 months from the commencement of this bill, for both the federal and state governments to make their respective contributions reflective of their equity holdings in the 11 successor distribution companies; and

“Such other mechanisms, such as fiscal and tax incentives to prevent the collapse of the NESI. Without prejudice to the provisions of subsection (2)(c) of this Section, the commission shall have the power to direct the core investors in the 11 successor distribution companies, including those under receivership, to recapitalise their respective equity holdings within such a time frame not exceeding 12 months from the commencement of this bill, and in deserving circumstances impose appropriate sanctions for non-compliance with its directive under this subsection, including an order for dilution of such shares held by core investors or re-privatisation.

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“The commission shall consult widely and take such measures as are necessary to ensure that the implementation of any order or directive on recapitalisation under sub-section (3) of this section neither disrupts continuity of service nor undermines investor confidence in the NESI.”

The government’s tough stance follows years of poor performance by the Discos, which continue to deliver erratic power supply despite multiple interventions, including debt forgiveness, financial bailouts, and tariff adjustments.

In May, the Federal Government openly expressed disappointment in the Discos, accusing them of frustrating ongoing reforms. At a media briefing in Abuja, the Minister of Power, Adebayo Adelabu, lamented that despite trillions of naira sunk into the sector, many Nigerians remain in darkness.

“The performance of the Discos has been grossly underwhelming,” Adelabu declared. “We can no longer tolerate excuses. If you can’t invest, give way to those who can.”

“We need to get tough with the Discos, as they can easily frustrate all the gains we have made. They have disappointed us in performance expectations. Whatever we do in generation does not mean anything to consumers if it is frustrated at the distribution points”.

A May 2025 report by the Bureau of Public Enterprises showed that more than 70 per cent of Discos have failed to meet key performance benchmarks set at the time of privatisation in 2013.

Reacting to the proposed timeline and pending directive, an official of power distribution companies dismissed concerns over the impact of the recently amended Electricity Act on Discos, saying the law is binding when assented to, and must be implemented by all stakeholders.

Reacting to industry debates surrounding the new legal provisions, the official, who spoke on condition of anonymity due to the lack of authorisation to speak on the matter, told The PUNCH that the focus should be on compliance and collaboration rather than resistance.

“It is totally irrelevant to say the law affects Discos. When the National Assembly makes laws, it is binding on all of us. What we should all do is to collectively implement and follow the law,” the official said.

The source noted that the amendments strengthen the powers of the Nigerian Electricity Regulatory Commission, a move the Discos are prepared to support.

“The regulatory commission has its powers, and when there is an amendment that further enhances that power, we are all for it. We believe in the wisdom of the National Assembly to amend the law, and we are ready to work with all stakeholders to ensure that the laws are implemented,” he added.

An electricity market expert, Chinedu Amah, says that the electricity sector challenges are not due to a lack of policies, but rather a failure to implement existing frameworks effectively.

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The expert noted in an interview on Tuesday that Nigeria is already saturated with policies and proposals, stressing that “policy overload” has become a recurring problem in the sector.

“We have policies on everything in Nigeria. So I don’t think it is a policy problem. Yes, there are policy gaps, but maybe we should just remove all the subsidies, flatten the tariff regime, and allow the market to drive investments,” the source said.

He added that while distribution companies have a responsibility to expand the grid and invest in infrastructure, the conversation must go beyond mere obligations.

“I don’t think it’s enough to say Discos need to make investments. You can’t force them to grow their business. But if there’s a critical infrastructure gap, it must be solved, whether by government, the private sector or through partnerships,” the official said.

However, another Power sector analyst, Habu Sadiek, called for key preconditions to ensure the initiative’s success. Reacting to provisions in the recently amended Electricity Act, Sadiek welcomed the plan but stressed the need for the government to first address pending financial issues within the sector.

“I think it’s a good thing,” he said. “But the government needs to do two things before initiating a recapitalisation programme: settle all outstanding subsidy payments and allow cost-reflective tariffs to prevail.” According to him, without resolving these issues, recapitalisation may not achieve its intended objectives.

He also criticised the 12-month window proposed for Discos to recapitalise, suggesting it was too short and unrealistic given current economic pressures. “Giving the current Disco owners 24 months, rather than 12, would have been better, similar to the Central Bank of Nigeria’s recapitalisation programme,” Sadiek added.

Additional efforts to get comments from the NERC on the issue proved abortive as the phone number of the Director, Public Affairs, Usman Arabi, was unreachable.

Meanwhile, the Minister of Power, Adebayo Adelabu, confirmed ongoing efforts to deploy special teams to underperforming power distribution companies as part of a broader restructuring programme.

Recall that in May 2025, the ministry announced a major overhaul of the power distribution sector, beginning with a pilot reform programme targeting two underperforming electricity distribution companies.

The pilot, scheduled to commence between May and August 2025, will involve one Disco each from the Northern and Southern parts of the country. The plan to restructure the companies came after a meeting with the Japanese International Cooperation Agency, which presented a roadmap titled “Revamping of the Distribution Sector in Nigeria”.

But giving an update on the process which is scheduled to end next month, the Special Adviser, Strategic Communications and Media Relations to the minister, Bolaji Tunji, on Monday, said the process is still ongoing. “It is an ongoing thing and we will brief you at the appropriate time,” he simply stated.

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What Nigeria’s 6 geo-political zones contributed to VAT & received in October 2025

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1. South-west
Contributed: N333.01bn
Received: N91.88bn (27.59%)

2. South-south
Contributed: N80.48bn
Received: N53.79bn (66.84%)

3. North-west
Contributed: N41.82bn
Received: N64.07bn (153.20%)

4. North-central
Contributed: N20.51bn
Received: N44.32bn (216.09%)

5. North-east
Contributed: N18.94bn
Received: N44.17bn (233.21%)

6. South-east
Contributed: N13.26bn
Received: N36.91bn (278.36%)
Source: FAAC/TheCableIndex

Credit: Ethnic African Stories

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See real reason ex-defence minister, Badaru resigned

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Details have emerged on the reason behind the sudden resignation of a former Minister of Defence, Badaru Abubakar, after two years in office.

Badaru resigned his position on Monday, citing health concerns.

In his place, President Bola Tinubu swore in a former Chief of Defence Staff, General Christopher Musa (retd.) as the new Minister of Defence.

Announcing Badaru’s resignation, the Special Adviser on Information and Strategy to the President, Bayo Onanuga, said in a statement that the former minister stepped down on account of “poor health.”

However, findings by Saturday PUNCH showed that the former minister was compelled to resign following a protracted cold war between him and the Minister of State for Defence, Bello Matawalle, a rift that had been carefully kept away from the media for months.

Badaru was appointed on August 21, 2023, months after completing his two term tenure as Jigawa State governor.

His appointment reportedly rested on his administrative credentials and regional influence in the North West, a region grappling with escalating banditry and insurgency.

After being sworn in alongside other ministers, Badaru was said to have prioritised military modernisation, intelligence reforms and counter terrorism operations.

Tinubu also appointed Matawalle on the same day to support Badaru, the senior minister, in executing defence policies.

However, in recent weeks, the two men came under intense public scrutiny following the resurgence of bandit and terror attacks, which prompted Tinubu to declare a nationwide security emergency.

The worsening insecurity snowballed into mass abductions of schoolchildren, with dozens of pupils and students kidnapped across several northern states.

The student kidnappings heightened pressure on the former defence minister, with some analysts calling for his removal on the grounds that he was failing to lead the ministry effectively.

The security crisis also renewed global scrutiny of Nigeria’s security posture, especially from the Trump administration which, in late October, re-designated Nigeria as a Country of Particular Concern over the alleged mass killing of Christians.

Amid mounting public outrage, the defence minister tendered his resignation on December 1.

In separate interviews with Saturday PUNCH, credible military sources within the defence ministry said Badaru’s long-running animosity with Matawalle, rather than health concerns, ultimately forced him out.

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An official of the ministry, who requested anonymity because he was not authorised to speak publicly, said the two ministers maintained a cordial appearance in public but had a “frosty relationship” behind the scenes.

“Matawalle and Badaru had a frosty relationship for most of the period he was minister, although they appeared cool with each other in public. But it is a known fact here that they had something against themselves,” the official said.

According to him, the tension affected some aspects of the ministry’s work, including media coordination.

“This affected some of their work. Even as a journalist, does the media unit look coordinated to you? Was this how it was being run before they came?

“Pairing the two together as ministers is something that ought not to have happened in the first place,” he added.

Another military source said it was believed that Matawale had a strong relationship with the presidency and was becoming domineering within the ministry.

The source noted that some party leaders within the All Progressives Congress considered Matawale as a political asset for the current administration, particularly within the north-western parts of the country.

“Matawale is from Zamfara State, and he has a very strong political presence in the state. The APC leaders see him as an asset for the 2027 election. So, they’re always on his side. He has the political backing and connection.

“But Badaru is weak, politically. The presidency does not actually reckon with him when it comes to power play and politics,” the source explained.

Calls for Matawalle’s resignation

Since Badaru resigned last week, some Nigerians, including activists and political commentators have amplified calls for Matawalle’s removal as Minister of State for Defence over the country’s security crisis.

Matawalle, a former Zamfara State governor, has faced periodic calls to step down, particularly from opponents in his home state.

In September 2024, Zamfara Governor Dauda Lawal publicly urged him to resign over alleged links to bandit groups, allegations Matawalle has repeatedly denied.

At the time, Lawal demanded that the minister cleared his name or resign.

Earlier, a petition by the APC Akida Forum also asked authorities to suspend Matawalle pending investigations into claims of collusion with criminal networks.

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In November 2025, the Good Governance and Accountability Monitoring Group asked the President to fire the minister, accusing him of “complicity” and “poor performance” as insecurity persisted.

Despite the clamour, officials within the ministry said Matawalle might retain his office amid shakeups in the security establishment in the past two months.

Also, officials in the Presidency, who confided in our correspondent, said Matawalle was appointed as part of a broader, coordinated response to banditry.

They cited his recent assignment to Kebbi State after the abduction of 24 students from Government Girls Comprehensive Secondary School, Maga, where a joint operation led to the girls’ release.

Meanwhile, Matawalle was notably absent on Friday when Gen. Musa (retd.) formally assumed office at the Ministry of Defence, Abuja.

There was no official explanation for his absence as of press time.

Musa, who was sworn in on Thursday by President Tinubu, arrived at the ministry to a reception dominated by the service chiefs, the permanent secretary and other senior officials.

Musa to review theatre commands

The new defence minister announced that one of his first actions in office would be a comprehensive review of all theatre commands and inter-service operational structures across the country.

Musa spoke on Friday while addressing officials of the Ministry of Defence during his maiden briefing on assumption of office.

The former Chief of Defence Staff said the review was necessary to strengthen jointness among the services, close operational gaps and ensure strategic alignment between policy and field operations.

The minister also stressed that welfare would be treated as a strategic priority, not an administrative task.

He listed prompt payment of allowances, timely issuance of kits, improved accommodation, quality medical care and support for families of fallen heroes as areas that would receive urgent attention.

Musa said, “We must also confront a critical truth: welfare is not administrative; it is strategic. Morale is a force multiplier. Our personnel must receive their kits on time. Their operational allowances must be paid promptly.

“Accommodation, medical care, and support for injured personnel and families of the fallen must be priorities. Those on the frontlines watch how we treat their colleagues. If they feel abandoned, they cannot give their best. Anyone who risks his or her life for Nigeria deserves nothing but utmost respect.”

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Musa said Nigeria could no longer afford disjointed or siloed security operations, emphasising that effective collaboration among the Army, Navy, Air Force and other security agencies was the only path to lasting success.

According to him, the ministry under his leadership would be guided by three pillars—operational effectiveness, unified action and strategic foresight.

“The threats we face are complex, but our spirit is stronger. No individual and no single service can achieve success alone. We must work as one Nigeria,” Musa added.

Musa promised zero tolerance for corruption, indiscipline and inefficiency within the ministry, noting that professionalism and integrity would define his tenure.

“I expect the highest standards of professionalism, integrity, and urgency. We do not have time to waste. We must respect human rights, avoid mistakes where possible, and when they occur, correct them decisively. I will always welcome candid advice and robust debate, but once a decision is made, we must move as one team.”

He also pledged to deepen the use of technology, intelligence and data-driven planning in defence operations while strengthening partnerships with allies and domestic security agencies.

“I am not here to preside. I am here to lead, to work and to deliver,” he declared.

He assured the service chiefs of his full cooperation and urged the civil service structure of the ministry to uphold diligence in translating military objectives into implementable policies.

Musa added that Nigerians were yearning for peace, security and stability, stressing that children must return to school and farmers to their farms.

“The shedding of innocent blood must end. Our children deserve to return to school. Farmers must return to their farms. Many of these issues require both kinetic and non-kinetic solutions—justice, equity, fairness, and good governance. We will pursue a comprehensive, balanced approach. The Nigerian people are looking to us for results—and we must deliver,” he said.

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Ondo council chair seeks monarchs’ support to fight insecurity

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The Chairman of Akure North Local Government Area of Ondo State, Mr. Johnson Ogunbolude, has appealed to traditional rulers in the council area to support government efforts in combating insecurity, as he distributed official vehicles to the monarchs.

PUNCH Online had earlier reported that suspected armed men attacked four communities in Akure North months ago, killing more than 20 farmers.

The midnight attacks affected Pastor Camp, Sunday Village, Ademekun Camp, and Alajido Camp in the Ala-Elefosan area of the council.

Speaking on Friday at the vehicle distribution ceremony held in Ita Ogbolu, the council headquarters, Ogunbolude said, his administration remained committed to improving security and the welfare of residents.

He explained that providing vehicles for the monarchs would boost security surveillance in their domains.

“This gesture is part of our renewed push to strengthen community security and address past cases of herdsmen attacks. These official vehicles for traditional rulers will enhance surveillance, rapid response, and improve local intelligence gathering within the council area,” he said.

“This initiative aligns with strategic measures to support Governor Lucky Aiyedatiwa’s drive to secure lives and property across Ondo State. Akure North, known for its vast farmlands and dispersed settlements, requires strengthened grassroots security.”

Ogunbolude emphasised that traditional rulers play a critical role in intelligence gathering, peacebuilding, and community vigilance.

According to him, the vehicles will improve monarchs’ mobility, enable closer monitoring of rural communities, and foster stronger collaboration with security agencies for prompt intervention.

The chairman also disclosed that the council would soon unveil additional security measures to further safeguard residents.

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At the event, Ogunbolude distributed N20,000 each to 300 elderly women under the council’s Elderly Welfare Scheme.

“Each of the 300 beneficiaries will receive monthly stipends of N20,000. Today, they collected N60,000 as arrears for two months.

“Protecting vulnerable groups helps sustain community harmony and reduces socio-economic stress linked to insecurity,” he added.

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