Federal Government Launches Pilot Program to Overhaul Nigeria’s Power Distribution Sector

Landmark Initiative Targets Underperforming DisCos

In a major move to revitalize Nigeria’s struggling electricity distribution sector, the Federal Government has announced a comprehensive reform initiative, beginning with a pilot program targeting two Distribution Companies (DisCos).

This strategic intervention comes after an extensive review of the sector’s persistent challenges, including aging infrastructure, governance issues, and poor financial performance.

Strategic Partnership with JICA

Power Minister Dr. Adebayo Adelabu revealed the plan following high-level discussions with the Japanese International Cooperation Agency (JICA), which presented a detailed reform proposal titled “Revamping of the Distribution Sector in Nigeria.”

The pilot program, scheduled to run from May to August 2025, will focus on one DisCo each in Nigeria’s northern and southern regions, serving as a blueprint for nationwide transformation.

Comprehensive Reform Approach

The initiative will combine internal restructuring, technical assistance, and strong government oversight to achieve measurable improvements in service delivery.

“We can no longer tolerate underperformance from DisCos,” Minister Adelabu stated. “This pilot isn’t optional. We will use all regulatory powers to restructure DisCos and ensure compliance where necessary.”

Addressing Systemic Challenges

The Minister addressed historical resistance to reforms, promising decisive action on both nationwide issues and region-specific challenges like vandalism and cultural barriers.

A critical focus will be solving DisCos’ chronic inability to fund infrastructure upgrades. “The problem isn’t always unwillingness—it’s often lack of incentives,” Adelabu explained. “We need models that attract investment and enable franchising of both viable and non-viable zones to capable operators.”

Regulatory Enforcement and Public Education

The Nigerian Electricity Regulatory Commission (NERC) has been directed to enforce franchising mechanisms and ensure full cooperation from DisCos. “This time, we will be intentional and decisive,” the Minister emphasized.

Adelabu also stressed the importance of consumer education: “Many Nigerians still see the power sector as a single entity. We must clearly explain the roles of generation, transmission, and distribution for these reforms to succeed.”

International Collaboration for Sustainable Reform

JICA’s proposal, developed following the Minister’s recent visit to Japan, advocates a phased, milestone-based approach with close Nigeria-Japan cooperation.

Mr. Takeshi Kikukawa, JICA’s Power Sector Policy Advisor to Nigeria, stated: “Our goal is to achieve quick wins in pilot areas while building a foundation for long-term national improvement.”

Final details of the pilot program will be announced in coming months, with priority given to DisCos facing the most severe operational challenges.

This initiative represents one of Nigeria’s most determined efforts to reform its power sector, aiming to restore investor confidence, enforce accountability, and deliver reliable electricity nationwide.