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The Nigerian Electricity Regulatory Commission (NERC) has dissolved the Board of Directors of the Kaduna Electricity Distribution Company (KAEDCO) due to the company’s failure to meet financial obligations to the Nigerian Bulk Electricity Trading Plc (NBET) and the Market Operator.
The dissolution, effective from January 1, 2024, is by the Electricity Act 2023 and will remain in force until further review or amendment by NERC.
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NERC Chairman, Sabusi Garba, stated that this action was taken due to KAEDCO’s persistent inability to provide a required bank guarantee, despite numerous attempts and extensions granted by the Commission.
Kaduna Electricity Distribution Company’s failure to meet its market obligations, contravening the Electricity Act and the terms of its distribution license, led to its dissolution.
Despite multiple opportunities given to address the shortcomings, including a statutory 60-day notice and subsequent extensions, Kaduna Electricity Distribution Company was unable to demonstrate satisfactory cause within the stipulated time frames. The company also failed to comply with basic market requirements, such as providing a bank guarantee to NBET, leading to outstanding debts exceeding NGN110 billion as of October 1, 2023.
In response, the Nigerian Electricity Regulatory Commission invoked its powers under the Electricity Act to remove all Kaduna Electricity Distribution Company Directors and dissolve its Board. Dr. Umar Abubakar-Hashidu has been appointed as the Administrator of Kaduna Electricity Distribution Company, overseeing its operations until the completion of the company’s sale to a new core investor. Nigerian Electricity Regulatory Commission has also constituted a non-executive Directors team pending the establishment of an Executive management team.
Dr. Hashidu has assumed the role of the new head of Kaduna Electricity Distribution Company, succeeding Mr. Yusuf Usman-Yahaya. The Administrator urged everyone to strive for excellence, expressing confidence in the management’s ability to lead the company toward progress.
