The Nigerian Electricity Regulatory Commission, (NERC), has extended its threat to cancel the licence of Kaduna Electricity Distribution Company, (KAEDCO), for another 30 days to fashion out ways to settle its N51billion underpayment to the Nigerian Electricity Supply Industry, (NESI).
NERC, in an advertorial signed by one of its commissioners, Dafe Akpeneye, dated July 19, stated that core investors of KAEDCO, Afrexim Bank and Fidelity Bank, did not give a satisfactory note on ways to sustain the financial viability of the company.
Recall that the regulator had in May given the company a 60 days’ notice to explain why it needs to exist in the electricity market.
But the advertorial stated that at the meeting, the representatives of the Disco made several proposals, which include receiver of interest to purchase 60 percent of the equity holding of the company, among others.
The DisCo had requested for three to six months to finalise the deal, including the provision of N2billion stabilisation fund to further reduce KAEDCO’s monthly market shortfall of N4.3bn by N250m in the short term.
The Commission, however, stated that the proposal failed to address concerns about the DisCo’s financial sustainability and the systemic risk that it poses to the electricity market.
It added that it received a request for ‘No Objection’ confirmation from Receiver Manager appointed by Fidelity Bank for the acquisition of 60 percent equity holding in Kano Electricity Distribution (KEDCO) by Powercom Smart grid Nigeria Limited (PSGN), via a letter dated 27 June 2023 and the PSNL indicated an interest to acquire 60 percent equity holdings in KAEDCO.
Meanwhile, PSGN, in a statement announcing its takeover of KAEDCO stated that the acquisition presents a significant opportunity for KAEDCO to implement a comprehensive turnaround plan aimed at improving performance and efficiency.
It said its strategic approach to address the challenges faced by KAEDCO would transform it into a highly efficient and financially viable electricity distribution company supporting five million customers.
