FG begins unbundling of 11 DisCos, orders sale of four

Our reporter/ The federal government has commenced the process of unbundling 11 electricity distribution companies to pitch them up for efficiency.

The minister of power, Adebayo Adelabu made the disclosure in his address, while playing host to the Senate Committee on Power, led by their Chairman, Senator Eyinnaya Abaribe, in Abuja on Monday.

Adelabu stated that the privatisation of the firms would not be reversed, but stressed that the Discos would be broken into more efficient structures along state lines to be able to deliver on their mandates.

“We are unbundling the Discos along state lines. Some of the Discos are too big for efficiency. They are too big for effectiveness. Ibadan Disco covers seven states. It is practically impossible for them to be efficient, Adelabu said.

“So we are rearranging and restructuring the Discos along state lines so that each state government will know the responsible Disco for their states. Also, the federal and state governments should start exercising their rights in the operation and management of the Discos because we still own 40 per cent in the firms.

“But we have left it for the private sector operators for too long and they have messed it up. So the government must come back to take over its own right in the Discos. We are also planning to franchise the unserved communities under the Discos.”

This came as the Federal Government also ordered the sale of Discos that had been taken over by banks and the Assets Management Corporation from their original investors/owners.

Four Discos are currently under the management of banks and AMCON.

The Abuja Electricity Distribution Company is under the management of the United Bank of Africa (UBA), while Fidelity Bank manages Benin Electricity Distribution Company, Kaduna Electricity Distribution Company, Kano Electricity Distribution Company, while Ibadan Electricity Distribution Company is under the AMCON management.

The government stated that those who acquired the Discos when the firms were officially privatised in November 2013, lacked the required expertise and financial capacity to run the companies.

Today the metering gap that we have is over eight million out of over 12 million customers of the power sector,” the minister stated.

Adelabu, however, noted that the federal government was working hard to close the metering gap.