The Federal Government is shopping for $4.7 billion to recapitalise the electricity Distribution Companies (DisCos), Transmission Company of Nigeria (TCN) Managing Director Usman Gur Mohammed has said.
The cash would be raised by the Federal Government, shareholders of the DisCos and private investors. It is all to upgrade power distribution facilities.
Upon the privatisation of the 11 Discos of the Nigeria Electricity Supply Industry (NESI) in 2013, the Federal Government retained 40 per cent of the equity in the DisCos and divested 60 per cent to private investors.
But power supply has remained epileptic, with the DisCos complaining about lack of cost reflective tariff and the government’s refusal to activate its stake in the companies. Mohammed, who broke the news of the government’s plans to upgrade the distribution network in Abuja, noted that the
Federal government will inject $1.7 billion into the DisCos. Private investors will pay up the balance that is proportional to their 60 per cent equity.
The DisCos have eight million customers. Going by the plan, each of the DisCos is expected to raise $500 million and also the Nigerian Electricity Regulatory Commission.