Power Epileptic: Representatives Call for N500B DisCo Capital Base
In order to improve their financial stability and guarantee that they can effectively fulfill their responsibilities to the public, the House of Representatives has ordered energy distribution firms, or DisCos, to undergo a N500 billion recapitalization.
The resolution came after the All Progressives Congress, or APC, plenary yesterday adopted a motion called “Need to Address the Activities of Distribution Companies in Nigeria,” which was sponsored by Ayokunle Isiaka, the member for Ogun State’s Ifo/Ewekoro Federal Constituency.
Isiaka, who moved the motion, claimed that recent DisCo activities have seriously threatened both the welfare of Nigerians and the country’s economic stability.
He voiced his worry that even though Nigerians pay for power meters, distribution corporations continue to seek more money for the meters’ replacement under dubious circumstances.
Under false pretenses, DisCos are requesting additional payments for the replacement of power meters, weakening consumer trust and making financial pressures worse, the member stated. “The House notes that Nigerian consumers paid for electricity meter installation.”The House is worried that customers are being forced to pay for meters they have already paid for, which will further burden already struggling homes and businesses.
“DISCOs undermining economic growth”
He also voiced concern about what he called DisCos’ sabotage of economic development, in which citizens are exploited to impede growth and development through the use of key services.
He continued by saying that DisCos had continued to act obstinately, operating with impunity and ignoring consumer rights in spite of ongoing regulatory supervision and the committee on power’s demands for responsibility.
After the proposal was approved, speaker Tajudeen Abbas called for DisCos to recapitalize at least N500 billion. She also said that only those with the necessary financial resources, which could maximize customer satisfaction, should be permitted to stay in business.
DisCos, who operate with impunity and disrespect for consumer rights, have remained obstinate in the face of the power committee.
Speaking after the resolution was approved, Speaker Tajudeen Abbas called for DisCos to “undergo recapitalization of no less than N500bn, and only those with the required financial capacity, which can provide maximum satisfaction to consumers, should be allowed to continue operating.”
The House thus ordered the Federal Ministry of Power to designate DisCos as non-state actors and take prompt steps to rectify their careless behavior, which it said endangered the economics of the country.
In order to hold DisCos responsible and protect consumer rights, it also required its power committee to look into their operations.
The committee was also charged with conducting consumer rights awareness programs and investigating the application of stringent rules governing DisCos to guarantee openness and equity in customer interactions.
FG decides to sell its 60% share in DisCos.
Recall that the government was forced to sell its holdings in the Electricity Distribution Companies due to the incapacity of the core investors, who held a 60% stake in the companies, to pay back the debts owed by the DisCos.
Accordingly, Vanguard’s checks yesterday showed that Abuja Electricity Distribution Company, Kano Electricity Distribution Company, and Kaduna Electricity Distribution Company had already been purchased.
ASI Engineering purchased 60% of Kaduna DisCo, Future Energy purchased Kano DisCos, and Transcorp Plc purchased Abuja DisCo.
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