DISCOs should stop preying on consumers

The privatisation of Nigeria’s power sector in 2013 was sold as a panacea—a shift from the lethargy of a state-run monopoly to the efficiency of private enterprise. Yet, over a decade later, the average Nigerian finds themselves in a bizarre economic paradox: they are treated as customers when it is time to pay bills, but as venture capitalists when it is time for infrastructure funding.

It is now common to see communities taxed by “utility committees” to procure transformers, aluminium conductors, or high-tension poles. This is a desperate response to a systemic failure. When a transformer blows, the Discos—profit-making entities—often wait for the community to “intervene.” By the time the community pools millions of Naira to restore power, they have gifted an infrastructural facility to a private company that will still charge them for the power supply passing through that same equipment. This is double-taxation of the highest order.

From the perspective of a sector player, the logic of privatisation is clear: the operator brings the capital, and the consumer pays for the service. When the consumer begins to provide the capital, the entire business model collapses. It removes the incentive for Discos to optimise their operations or reduce their Aggregate Technical, Commercial, and Collection (ATC&C) losses. Why should an operator worry about capital expenditure (CAPEX) when the residents of a street are willing to buy the wires and the poles themselves?

This “community-funded” model also deepens social inequality. We are inadvertently creating a two-tier society where light is a luxury reserved for neighborhoods wealthy enough to finance their own grids. Poorer communities, unable to raise funds for a new transformer, are condemned to months—sometimes years—of darkness, further stifling the small-scale businesses that are the lifeblood of our economy.

The Nigerian Electricity Regulatory Commission (NERC) and the Federal Competition and Consumer Protection Commission (FCCPC) have been vocal in stating that these practices are illegal. However, regulation without enforcement is merely advice. The regulator must move beyond press releases. There must be a transparent, automated framework for “Investment Credit.”

If a community must fund a transformer due to an emergency, every kobo spent should be converted into energy credits, ensuring the Disco pays back the “loan” through free electricity until the debt is cleared.

We must stop the normalisation of this anomaly. Consumers are the end-users of a product, not the architects of the distribution network. The government must ensure that Discos have access to proper financing through the banks, rather than relying on the dwindling pockets of Nigerians. Until the burden of infrastructure is returned to the balance sheets of financially capable Discos, the promise of a functional, privatised and socially just power sector will remain elusive.

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