Chief Adebayo Adelabu, Minister of Power

…DisCos abysmal performance, aging networks, rampant electricity theft, poor investment and deepening reliance are no longer reliable in the sector 

Chief Adebayo Adelabu, Minister of Power has revealed that the Federal Government (FG) is indebted to Electricity Generation Companies (GenCos) about N4 trillion, including the N1.94 trillion since 2024.

Adelabu made it known that payment of electricity subsidy is no longer sustainable adding that it is gulping to N200 billion monthly.

The Minister said that the current tariffs are unsustainable as it is draining the public funds that are needed to upgrade infrastructure.

He spoke at a two-day retreat organized by the Senate Committee on Power where there was a statement by the Minister’s Strategic Communication and Media Relations, Mr. Bolaji Tunji issued that, “The sector also faces a ₦4 trillion subsidy backlog owed to generation companies, including ₦1.94 trillion for 2024 alone. With monthly subsidy shortfalls now hitting ₦200 billion, the Minister warned that maintaining current tariffs is “unsustainable,” straining public funds needed for infrastructure upgrades.”

The Minister pointed out that, “To salvage the sector, we will soon embark on restructuring underperforming DisCos and tightening enforcement of performance benchmarks.

However, without urgent capital injection into distribution networks, gains in generation—including a historic 6,003MW output in March 2025—and transmission upgrades, such as 61 new transformers deployed in 2024, will fail to translate to reliable household supply”.

The Minister also emphasises on persistent crisis threatening to derail progress in the sector which is chronic underinvestment in distribution infrastructure, which continues to cripple service delivery nationwide in spite of landmark reforms in the electricity sector.

He spoke on disparities in Distribution Companies (DisCo) performance, with aging networks, rampant electricity theft, and poor investment deepening reliance on unsustainable subsidies and leaving millions in darkness.

“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”.

He noted that in 2003 restructuring of the sector, the DisCos were supposed to have technical partners, but a lot of them showed partnership with foreign companies for that purpose which lasted for about three months, immediately they took over, those companies left. So we need utility companies that can invest in the sector to improve infrastructure, improve service”, adding that, “a lot of them went to the banks to take loans to buy the assets, after taking over, instead of providing infrastructure they are taking out the money to pay the loans”.

“Despite tariff adjustments that boosted market liquidity by 70 percent—raising sector revenue from ₦1 trillion in 2023 to ₦1.7 trillion in 2024—the distribution segment remains the weakest link.

In the fourth quarter of 2024, DisCos in the North remitted just ₦124.4 billion (30 percent) of their ₦408.86 billion invoice, with Abuja DisCo accounting for 85 percent of Northern payments. Southern DisCos fared slightly better, remitting ₦254.6 billion (67 percent), though 70 percent of this came from Lagos DisCos alone. These discrepancies are due largely to crumbling infrastructure outside economic hubs, where underinvestment has left networks dilapidated”.

The Minister was of the view that the metering gap, a key driver of revenue loss and consumer distrust, underscores systemic neglect adding that the government has launched a ₦700 billion Presidential Metering Initiative (PMI) and a World Bank-backed program targeting 4.3 million meters by 2025, 75,000 units were deployed in April 2024 while additional 200, 000 is expected in May.

The Minister highlighted plans to attract private investment into grid infrastructure and regionalize transmission networks to reduce failure risks noting that the 70 percent remittance by the two DisCos in Lagos reflects better infrastructure than what obtains in the northern networks.

Adelabu appealed to the National Assembly to enact stricter legislation aimed at safeguarding Nigeria’s power infrastructure from acts of vandalism. He said robust laws are critical to deterring the destruction of vital energy assets and ensuring stability of power supply in the country.

Vandalism should not be treated as a civil offence but a criminal issue. Power theft, nonpayment of bills by consumers, illegal connections are critical factors that need to be tackled which is the bane of the sector.

The Minister acknowledged challenges but the grid has been stabilized as the country has not witnessed any grid collapse since the beginning of the year which a good development for the power sector.