As the licences of the electricity distribution companies in Nigeria (Discos) expire in 2028, the federal government is considering the introduction of a minimum capital adequacy requirement as part of the license renewal process to strengthen the financial health and liquidity position of the utility firms.
Minister of Power, Adebayo Adelabu, disclosed this yesterday in Lagos while speaking during the Leadership Seminar at the ongoing Nigeria Energy Exhibition and Conference, with the theme: “Powering Nigeria through Investment, Innovation, and Partnership.”
Adelabu observed that the Nigerian power sector continues to face challenges of under-capitalisation among several Discos and a severe debt burden that has constrained their operational efficiency and service delivery over the years.
“As the tenure of their operational licenses approaches renewal, the government intends to introduce a minimum capital adequacy requirement as part of the license renewal process, to strengthen the financial health and liquidity position of the utilities”, the minister stated.
