NISO Threatens Sanctions as DisCos Owe N1.5tn Electricity Market Debt
By Aboki Forex —
Electricity distribution companies may face sanctions over more than N1.5 trillion in unpaid obligations to Nigeria's electricity market. The Nigeria Independent System Operator (NISO) rejected repayment plans submitted by some of the DisCos, saying the debts were too large and had stayed unpaid for too long.
NISO disclosed this in a statement on its social media platforms on Tuesday, September 7, 2026, after a four-day hearing with the DisCos over their outstanding debts to the Nigerian Electricity Market and service providers. The hearing ran from September 1 to September 4.
Why NISO Rejected the Repayment Plans
The hearing was set up to examine the DisCos' accumulated liabilities and weigh their proposals for clearing the debts. NISO said it held extensive discussions during the session before ruling on the plans. In the end, it described some of the proposals as unacceptable, pointing to the size and age of the debts.
The standoff underlines the financial pressure building inside Nigeria's electricity distribution sector, where unpaid obligations continue to drag on the wider power market.
The Debt Numbers
Data cited in an April report showed the combined liabilities of the country's 11 DisCos had risen to about N1.3 trillion as of September 25, 2025, up from roughly N1 trillion at the end of 2024. Accumulated interest and continued payment defaults drove the increase.
Kaduna DisCo carried the heaviest load at N303.81 billion, followed by Abuja DisCo with N275.17 billion. Jos DisCo owed N104.38 billion, while Ibadan had outstanding obligations of N103.41 billion. Kano owed N96.62 billion, Port Harcourt N88.40 billion and Benin N82.11 billion.
The old Yola DisCo had N61.20 billion in liabilities. Ajaokuta, Ikeja and Enugu owed N58.59 billion, N47.64 billion and N39.11 billion respectively. Eko DisCo's liability stood at N16.49 billion, while the new Yola entity had N241.68 billion.
A Long Running Crisis
The latest dispute is part of a debt crisis that has troubled Nigeria's electricity market for years, with several DisCos owing billions of naira amid accumulated interest and defaults.
On the regulatory side, the Lagos State Electricity Regulatory Commission (LASERC) issued 14 new electricity licences to deepen competition in the sector. Axxela and Isolo Power Gen received approvals for major power generation projects across Lagos. LASERC also plans new zonal offices to improve customer service and make regulatory access easier for electricity consumers.
For Nigerian businesses and households, the outcome of the NISO hearing matters because the market debt sits behind the liquidity problems that shape supply and tariffs. Whether the threatened sanctions push the DisCos into payment, or simply deepen the standoff, will determine how quickly the market settles.