The Nigerian Electricity Regulatory Commission (NERC) has taken over the Kaduna Electricity Distribution Company (KAEDC) and dissolved its board of directors over a mounting debt crisis that has pushed the company’s cumulative market obligations to about N456.5 billion.
NERC announced the intervention in a regulatory order issued on August 10, 2026, saying the move was necessary to preserve Kaduna DisCo as a going concern and ensure uninterrupted electricity distribution services across its network.
The regulator said the decision followed months of worsening financial and operational challenges, including persistent market payment defaults, weak collections, high technical and commercial losses, and the failure of the company’s core investor to provide a credible recovery plan.
According to NERC, Kaduna DisCo accumulated an additional N118.6 billion in market debt between June 2024 and May 2026, after ASI Engineering Limited assumed operational control as the company’s core investor.
The commission said Kaduna DisCo and its core investor repeatedly failed to provide acceptable payment guarantees required under electricity market rules and did not submit a credible plan for settling the company’s outstanding liabilities.
NERC said it had therefore resolved to dissolve the board and intervene in the company while pursuing a transparent transition to a new core investor within the next 12 months.
“Further to the meeting of 11 June 2026, the Commission resolved to exercise its powers conferred under sections 75–79 of the EA to dissolve the board of directors of KAEDC by intervening to preserve the undertaking as a going concern and achieve a transparent transition to a credible core investor within 12 months,” the regulator said.
Under the intervention, NERC will appoint special directors to serve as an interim board and withdraw regulatory approvals previously granted to the company’s management team.
The commission will also retain Kaduna DisCo’s current Managing Director as Administrator for an initial six-month period while commencing a supervised process to identify a technically competent and financially capable replacement core investor.
NERC said the intervention was being carried out in the public interest to safeguard electricity distribution services and restore the company’s financial and operational viability.
The regulator disclosed that Kaduna DisCo’s cumulative market obligations stood at N456.5 billion as of May 31, 2026.
Of the total, N415.5 billion was owed to the Nigerian Bulk Electricity Trading Plc (NBET), while N41 billion was owed to the Nigerian Independent System Operator (NISO).
The company also had N14.26 billion in other statutory and third-party obligations.
NERC said the company’s financial position deteriorated further after ASI Engineering Limited assumed operational control in June 2024, with the investor overseeing the accumulation of an additional N118.6 billion in market debt over the following two years.
The regulator also criticised Kaduna DisCo and its core investor for failing to provide acceptable payment guarantees to NBET and NISO, as required under electricity market rules.
NERC said the company paid only 41.93% of its adjusted market invoices during the review period ending December 31, 2025, resulting in a market payment shortfall of N46.71 billion.
The commission attributed the weak remittance performance partly to Kaduna DisCo’s high Aggregate Technical, Commercial and Collection (ATC&C) losses.
The utility recorded ATC&C losses of 71.88% during the 2025 review period, meaning it accounted for only 28.2% of the electricity it received and delivered to customers.
The latest intervention follows a series of financial and governance challenges that have affected Kaduna DisCo since ASI Engineering Limited took over operational control.
In July 2024, NERC approved the acquisition of a 60% equity stake in Kaduna Electricity Company Plc by ASI Engineering Limited, paving the way for the investor to assume control of the utility.
However, the company subsequently became involved in several debt-related disputes.
In August 2024, the Kaduna State Internal Revenue Service sealed Kaduna DisCo’s office over alleged unpaid tax liabilities of about N600 million.
The same month, Kaduna DisCo disconnected electricity supply to the Kaduna State Government House over an outstanding electricity debt of N2.9 billion.
NERC’s latest action underscores the growing regulatory pressure on Nigeria’s electricity distribution companies to address rising market debts, improve remittance performance and strengthen corporate governance.
Kaduna DisCo now faces a regulatory restructuring process that is expected to culminate in the selection of a new core investor within 12 months, as NERC seeks to restore the company’s financial stability and operational viability.
