By Seun Ibiyemi
The Nigeria Independent System Operator (NISO) has announced plans to sanction electricity distribution companies (DisCos) over outstanding obligations owed to the Nigerian electricity market and service providers.
The decision followed a four-day public hearing held from September 1 to 4, 2026, during which NISO reviewed the outstanding debts of DisCos and the payment plans proposed to settle them.
NISO said some of the payment proposals were unacceptable, particularly because of the size and age of the outstanding obligations.
The hearing was conducted by a five-member committee chaired by NISO’s Executive Director, Market Operations, Engr. Dr. Edmund Eje.
The committee expressed concern over the payment frameworks submitted by some DisCos and urged the affected companies to take immediate steps to clear their outstanding balances.
NISO noted that the Federal Government had already netted off approximately 97 per cent of the DisCos’ outstanding obligations for the 2015–2020 period.
It therefore stressed that the affected distribution companies must now take steps to liquidate the remaining balances.
“NISO will therefore proceed with the next steps, including the application of applicable sanctions as provided under the Market Rules,” the system operator said.
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The organisation said the process would continue to be guided by constructive engagement, transparency and due process.
According to NISO, the engagement was aimed at strengthening market discipline, compliance and accountability among participants in the Nigerian Electricity Market.
The system operator added that resolving the outstanding obligations was critical to the effective functioning and development of the electricity market and its service providers.
It said the move would also help improve confidence in the electricity market and ensure that market participants meet their financial obligations.
