NERC Dissolves KAEDC’s Board Over N456bn Debt, Appoints administrator
By Abba Sunday, Abuja
The Nigerian Electricity Regulatory Commission (NERC) has dissolved the board of Kaduna Electricity Distribution Company (KAEDC) and appointed the erstwhile Managing Director/Chief Executive Officer (MD/CEO), Dr Abubakar Umar Hashidu, as administrator for an initial six- month period, alleging insolvency, operational and regulatory defaults.
The Commission made the development known in Order No. NERC/2026/086, issued on Monday, 10 August, 2026, with effect same day, following an inquiry and consultations with key industry stakeholders, including the Bureau of Public Enterprises (BPE).
According to NERC, KAEDC was in a “grave situation” characterised by prolonged regulatory and market default, inadequate investment, weak operational and commercial performance, insufficient assets relative to its liabilities and an inability to present a credible pathway to sustainable recovery.
The Commission said the distribution company (DisCo)’s cumulative market obligations since privatisation stood at approximately N456.5 billion as of May 2026, comprising N415.5 billion owed to the Nigerian Bulk Electricity Trading Plc (NBET) and N41 billion owed to the Nigerian Independent System Operator (NISO).
It added that KAEDC had accumulated another N14.26 billion in non-market statutory and third-party obligations.
NERC further stated that since ASI Engineering Limited (ASI) took over operations of KAEDC in June 2024, the DisCo had incurred an additional N118.6 billion in market debt as of May 2026.
The Commission said ASI and KAEDC had “persistently failed” to furnish NBET and NISO with acceptable payment bank guarantees as required under their Vesting Contract and the Market Rules of the Nigerian Electricity Supply Industry (NESI).
The core investor also failed to provide a credible payment plan for the outstanding liabilities, NERC said.
The Commission cited KAEDC’s poor remittance performance as another reason for the intervention. It said the DisCo paid only 41.93 per cent of adjusted market invoices in 2025, leaving a market shortfall of approximately N46.71 billion.
The poor remittance performance was linked to KAEDC’s high Aggregate Technical, Commercial and Collection (ATC&C) losses, which stood at 71.88 per cent during the 2025 review period.
“This means that in the 2025 review period, KAEDC was only able to account for only 28.2 per cent of the energy received and delivered to end-use customers,” the Commission said.
NERC also faulted the investor’s capital expenditure performance, saying ASI failed to meet its capital injection commitments towards the recapitalisation of the utility.
According to the order, KAEDC’s actual capital expenditure in 2025 was approximately N2.48 billion, against a minimum capital expenditure provision of N24.51 billion, representing only 10 per cent CAPEX performance.
The Commission noted that the actual expenditure followed derogations and forbearances granted by NERC.
The DisCo’s metering performance was also described as “abysmally low”, with meter coverage of its end-use customer population remaining between 33.26 per cent and 35.54 per cent since ASI took over the company, despite interventions aimed at supporting metering deployment.
NERC said its earlier conditional no-objection of January 18, 2024 had approved the proposed acquisition of a 60 per cent equity stake in KAEDC by ASI, working with its nominated technical partner, Akanksha Power and Infrastructure Limited (APIL), subject to several conditions.
These included evidence of APIL’s capacity to perform in Nigeria, a substantive technical-support proposal for KAEDC’s turnaround, a compliance plan for meeting NERC’s key performance indicators, a credible management team, a credible ATC&C loss-reduction trajectory and plans for bank guarantees in favour of NBET and the relevant market operator.
However, NERC said ASI continued to fail to demonstrate full compliance with the requirements, while outstanding regulatory conditions remained unresolved.
Against this background, the Commission dissolved the existing board and removed all its directors from office.
It appointed an interim board chaired by Dr. Abdullahi Garba, with Engr Francis U. Agoha, Mr. Aliyu E. Aliyu, Major General Henry E. Ayamasaowei (rtd), Dr Haliru Dikko and Mr Ayodeji A. Gbeleji, representing the BPE, as special directors.
Hashidu was also appointed a special director for an initial six-month term and designated administrator of the DisCo.
As administrator, he will oversee day-to-day operations, implement interim board resolutions and NERC directives, safeguard KAEDC’s assets and records, and handle matters reserved for approval by the Commission or interim board.
NERC also withdrew the Key Yardstick Licence (KYL) approvals issued to members of KAEDC’s management team and directed affected staff to present themselves for revalidation.
The Commission imposed restrictions on major financial and corporate decisions by KAEDC during the transition period, including borrowing, disposal or transfer of material assets, related-party transactions, changes to senior management remuneration, appointment or removal of senior officers and alteration of the company’s capital structure.
The administrator was further directed to submit a costed 12-month stabilisation plan within 60 days, covering cash-flow controls, market remittances, collections, metering, energy accounting, loss reduction, service reliability, safety, customer complaints, capital expenditure, procurement, staff obligations and legacy liabilities.
