The Nigerian Electricity Regulatory Commission (NERC) has dissolved the board of Kaduna Electricity Distribution Plc (KAEDC) over its ₦456.5 billion cumulative market obligations and prolonged financial and operational challenges.
The regulator, in an order that took effect on Monday, August 10, 2026, appointed an interim board of special directors and directed the commencement of a transparent process to secure a new core investor for the electricity distribution company.
NERC said the decision followed an extensive inquiry and consultations with key stakeholders, including the Bureau of Public Enterprises (BPE). It cited prolonged regulatory and market defaults, inadequate investment, weak operational performance and the company’s inability to demonstrate a credible path to financial recovery.
According to the commission, KAEDC’s cumulative market obligations stood at approximately ₦456.5 billion as of May 2026. The debt included ₦415.5 billion owed to the Nigerian Bulk Electricity Trading Plc and ₦41 billion owed to the Nigerian Independent System Operator.
The company also had an additional ₦14.26 billion in non-market statutory and third-party obligations.
NERC said that since ASI Engineering Limited assumed control of KAEDC in June 2024, the company had accumulated more than ₦118.6 billion in additional market debt by May 2026.
The regulator disclosed that KAEDC remitted only 41.93 per cent of its adjusted market invoices in 2025, resulting in a market shortfall of about ₦46.71 billion.
It attributed the poor performance largely to the company’s high technical, commercial and collection losses, which reached 71.88 per cent in 2025. This meant the company was able to account for only about 28.2 per cent of the electricity it received and delivered to customers.
NERC also said ASI Engineering failed to meet its capital injection commitments. KAEDC spent approximately ₦2.48 billion on capital expenditure in 2025, compared with the minimum requirement of ₦24.51 billion, representing only 10 per cent performance.
The commission further noted that KAEDC’s meter coverage had remained between 33.26 per cent and 35.54 per cent since ASI took over, despite several interventions aimed at improving metering across electricity distribution companies.
NERC said the company’s financial difficulties continued despite approximately ₦6.58 billion in regulatory relief granted between January 2024 and May 2026, as well as about ₦53.79 billion in Federal Government intervention funds disbursed since July 2018.
The regulator warned that KAEDC’s continued underperformance posed significant risks to electricity consumers, creditors, market stability and the continuity of electricity services.
NERC said ASI had previously been given opportunities to present a credible recovery plan but later requested an additional 24 months to stabilise the company’s cash flow, make critical investments and improve its performance.
The request was rejected because ASI had been in effective control of KAEDC since June 2024 without achieving significant improvement in its financial and operational performance.
Consequently, NERC invoked its powers under Sections 75 to 79 of the Electricity Act 2023 to dissolve the board and preserve the company as a going concern while facilitating the transition to a new credible core investor.
Seven special directors were appointed to oversee the interim period, with Dr Abdullahi Garba serving as chairman.
Other members of the interim board are Engr. Francis Agoha, Mr Aliyy Aliyu, retired Major General Henry Ayamasaowei, Dr Haliru Dikko, Mr Ayodeji Gbeleyi of the BPE, and Dr Abubakar Umar Hashidu.
NERC also appointed the incumbent Managing Director and Chief Executive Officer, Dr Abubakar Umar Hashidu, as administrator for an initial six-month period.
The administrator will oversee the company’s day-to-day operations, ensure continuity of electricity services, implement decisions of the interim board, comply with NERC directives and safeguard KAEDC’s assets and records.
The commission also withdrew the Know-Your-Licensee approvals previously issued to KAEDC’s management team and ordered affected officials to undergo revalidation.
Meanwhile, NERC directed Afrexim Bank to coordinate an open and competitive process for selecting a replacement core investor for KAEDC.
The preferred investor must be presented to NERC for approval, with the process expected to be completed within 12 months from the effective date of the regulatory order, unless the commission grants a written extension.
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