The Nigerian Electricity Regulatory Commission, NERC, has dissolved the board of Directors of the Kaduna Electricity Distribution Company, KEDC, over its inability to meet its market obligations to the tune of N182.16 billion in the past four years.
The amount includes N51.9 billion market remittance shortfall, N25 billion minimum capital expenditure requirements and N11.46 billion operations expenditure requirements for year 2023.
The Commission also disclosed that from year 2020-2022, Kaduna DisCo recorded N93.41 billion in market remittance shortfalls, bringing a total outstanding of N186.16 billion.
The company, owned by AfreximBank, Fidelity Bank and the Bureau of Public Enterprises, BPE, has been seeking a core investor for almost two years.
NERC in a 9-page order signed by its Chairman, Sanusi Garba and Vice Chairman, Musiliu Oseni, which took effect from January 1, 2024, appointed Dr. Umar Abubakar Hashidu as the Sole Administrator of the utility with Mr. Alex Okoh, Chairman, Kabir Adamu, Sharfuddeen Mahmoud, John Ayodele, and Rahila Thomas as non-executive members of the new board.
The Commission explained that its analysis “indicates that KAEDC is currently experiencing severe liquidity challenges and its commercial viability and continuation as a market participant is in doubt.
“The Commission noted that KAEDC’s management team had not been able to develop and present a clear pathway towards capital injection, operational efficiency, and sustainability despite the various regulatory initiatives of the Commission and other financial interventions of the government”.
The regulator added: “KAEDC has consistently failed to meet its obligations to the market in contravention of the EA and the terms and conditions of its electricity distribution licence issued by the Commission.
“The management, board and shareholders of KAEDC have been granted ample opportunities to address the utility’s failing performance at meetings with the Commission; and they have been unable to cure the utility’s failure”.
NERC said the company would be sold to investors with highest and best price.
Meanwhile, Umar Abubakar Hashidu has taken over the reigns as the Chief Executive Officer of Kaduna Electric. He took over from Engr. Yusuf Usman Yahaya who resigned last week.