Joseph Bakare
The board of Kaduna Electricity Distribution Plc (KAEDC) has been dissolved over years of financial default, weak operational performance and core investor’s failure to deliver on its turnaround promises.
The Nigerian Electricity Regulatory Commission (NERC), which carried out the decision has installed an interim administration.
The Order, numbered NERC/2026/086 and signed by the Commission Chairman, Musiliu Oseni, and NERC Commissioner, Legal, Licensing & Compliance, Dafe Akpeneye, took effect Monday.
It invokes NERC’s intervention powers under Sections 75 and 79 of the Electricity Act 2023, which allow the regulator to remove the leadership of a failing power licensee to protect customers and keep the business running as a going concern.
The Order states that KAEDC’s cumulative market debt had reached about N456.5 billion as of May 2026, owed mainly to the Nigerian Bulk Electricity Trading Plc (NBET) and the Nigerian Independent System Operator (NISO), plus roughly N14.25 billion in other statutory and third-party obligations.
According to NERC, the company has piled up more than N118.6billion in additional market debt since ASI Engineering Limited took over its operations in June 2024.
NERC’s data show KAEDC’s remittance performance was weak and uneven throughout 2025, ranging from as low as 32 per cent of adjusted market invoices in January to a high of about 60 per cent in February, before closing the year at roughly 36 per cent in December. Noting that over the full year, the company remitted only about 41.93 per cent of what it owed the market, leaving a shortfall of close to N46.71 billion.
That shortfall tracked closely with the company’s technical and commercial losses, which the regulator put at nearly 72 per cent for 2025 -meaning KAEDC could only account for about 28 per cent of the electricity it received and delivered to customers. Monthly loss figures stayed persistently high throughout the year, rarely dropping below 63 per cent.
Capital investment also fell well short of requirements: actual spending 2025 was about N2.28 billion against a required minimum N24.51 billion, a shortfall NERC described as a 10 per cent capital-expenditure performance.
Meter coverage across KAEDC’s customer base slipped from roughly 35.5 per cent early in the year to about 33-34 per cent for most of 2025, despite industry-wide efforts to expand metering.
NERC had granted conditional approval in January 2024 for ASI, working with technical partner, AKanksha Power and Infrastructure Limited (APIL), to acquire 60 per cent of KAEDC, subject to conditions including proof of technical capability, a loss-reduction plan, credible management and bank guarantees to market operators.
The Order said ASI never fully met these conditions even after taking operational control in mid-2024, and also failed to satisfy separate requirements set by the Bureau of Public Enterprises (BPE) for the sale.
Although ASI wrote to the Commission in August 2025 asserting it had met the required conditions- citing internal restructuring, staff reductions, metering and loss-reduction projects, and moves to raise equity and debt financing -NERC found the submission lacked adequate supporting evidence, particularly on planned infrastructure investment and its technical partnership arrangements.
The regulator noted that substantial government support has not reversed the decline: KAEDC received about N6.58 billion in regulatory forbearances between January 2024 and and May 2026, on top of roughly N53.79 billion in cumulative federal intervention funding since 2018.
After NERC warned KAEDC’s major shareholders and financier Afreximbank of impending intervention, representatives met with the Commission, the BPE and Fidelity Bank Plc in June 2026. At that meeting, all parties agreed ASI had not complied with the Commission’s takeover conditions or the BPE shareholding requirements.
ASI asked for a 24-month extension to stabilise the company’s cash flow and deliver measurable improvements, but NERC said the investor had already had more than two years of operational control without corresponding progress, and concluded a further extension of similar length was not justified given the ongoing risk to customers and the market. The regulator said ASI never backed up the request with a credible plan.
NEW LEADERSHIP INSTALLED
NERC has appointed a seven-member interim board of special directors, chaired by Dr. Abdullahi Garba, with Ayodeji Gbeleyi representing the BPE. Dr. Abubakar Umar, KAEDC’s outgoing managing director, has been named Administrator for an initial six-month term and will continue overseeing day-to-day operations under the interim board.
The Order also withdraws Know-Your-Licensee (KYL) clearances from KAEDC’s entire management team, who must now be revalidated by the Commission, and bars major financial or structural decisions, including new borrowing, asset sales, or senior executive appointments, without the interim board’s and NERC’s approval.
Under the Order, the Administrator must submit a costed 12-month stabilisation plan within 60 days, covering cash flow, remittances, metering, loss-reduction and liabilities. Afreximbank will lead a competitive process, coordinated with NERC, to find a new core investor within 12 months, with staged deadlines for a transaction timetable, bid documents, a qualified bidder shortlist and final transaction documents.
Prospective investors will need to show adequate working capital, transparent ownership, technical turnaround capability, backing from reputable financial institutions, and a five-year business plan. The preferred bidder must also provide cash-backed funding for the first two years of an approved capital-investment programme, a bank performance bond for the following three years, a year of working capital, and bank guarantees covering at least three months of market invoices to NBET and NISO.
A separate liability-management plan addressing KAEDC’s debts is due within 90 days, to be developed jointly by the Administrator, BPE, NBET, NISO, and other major creditors.
NERC said the intervention was intended to keep electricity flowing to customers in Kaduna and surrounding areas while a transparent process delivers a financially and technically capable replacement investor for the utility.