Reps Committee on Power Urges DisCos to clear market debts

“IBEDC and other indebted DisCos must make every effort within their capacity to settle their outstanding obligations and strengthen compliance with the rules governing the electricity market.” Hon. Onyemaechi, House Committee Chairman on Power

.... Expresses concern over the growing market debts, warning that prolonged failure by the DisCos to meet their financial obligations could further weaken the electricity market.

The House of Representatives Committee on Power has urged electricity Distribution Companies with outstanding market obligations to take urgent steps to clear their debts, warning that persistent defaults could threaten the liquidity and sustainability of Nigeria’s electricity market.

The committee made the call on Wednesday during an oversight visit to the headquarters of the Nigerian Independent System Operator in Utako, Abuja.

The lawmakers, led by the Chairman of the committee, Rt. Hon. Nwokolo Victor Onyemaechi, witnessed an ongoing public hearing by NISO on the outstanding market obligations of the Ibadan Electricity Distribution Company.

The hearing, chaired by NISO’s Executive Director, Market Operations, Dr Edmond Eje, was part of the system operator’s engagements with selected DisCos over outstanding market obligations, Events of Default and other compliance issues under the Nigerian Electricity Market.

Speaking during the hearing, Onyemaechi charged IBEDC and other indebted DisCos to make concerted efforts to settle their outstanding obligations, stressing that improved liquidity was critical to strengthening the electricity market and sustaining the power sector.

The affected DisCos include Benin Electricity Distribution Company, Enugu Electricity Distribution Company, Ibadan Electricity Distribution Company, Jos Electricity Distribution Company, Kaduna Electricity Distribution Company, Port Harcourt Electricity Distribution Company and Kano Electricity Distribution Company.

Onyemaechi expressed concern over the growing market debts, warning that prolonged failure by the DisCos to meet their financial obligations could further weaken the electricity market.

He said, “IBEDC and other indebted DisCos must make every effort within their capacity to settle their outstanding obligations and strengthen compliance with the rules governing the electricity market.”

Following the public hearing, the committee proceeded with its scheduled oversight engagement with the management of NISO.

The Managing Director and Chief Executive Officer of NISO, Engr. Abdu Bello Mohammed, commended the lawmakers for their oversight role and continued support for reforms in the electricity sector.

Mohammed said the establishment of NISO was a major outcome of reforms introduced under the Electricity Act, 2023, which provided the framework for the unbundling of the Transmission Company of Nigeria and the creation of an independent system operator.

He briefed the committee on NISO’s mandate, its operations and a five-year development plan aimed at strengthening system operations, improving electricity market operations, enhancing system planning and supporting the effective coordination of Nigeria’s power system.

The NISO boss also stressed the need for stronger collaboration between the National Assembly, the system operator and other stakeholders in addressing the structural and financial challenges confronting the Nigerian Electricity Supply Industry.

Mohammed said improved liquidity in the market would enable participants to meet their obligations, sustain operations and ultimately improve electricity supply to consumers.

He appealed to the National Assembly to sustain its support and constructive oversight, noting that stronger collaboration among institutions in the sector was crucial to stabilising the national grid and achieving a more reliable and sustainable electricity supply in the country.