Kano Electricity Distribution Company (Kano DisCo) has demonstrated remarkable resilience and operational efficiency by achieving a record market settlement rate, despite facing significant systemic challenges and external shocks.
This achievement highlights Kano DisCo’s commitment to improving its performance and ensuring a sustainable energy supply to its customers.
Inherited challenges and turnaround efforts
When the new management took over Kano DisCo, it inherited a myriad of systemic issues that posed substantial obstacles to its operations. These challenges included low metering coverage, poor revenue contribution per employee, and low billing efficiency compared to other DisCos.
Metering coverage was particularly concerning, as Kano DisCo had the lowest rate among all DisCos. In 2023, less than 15 percent of households in Kano DisCo’s franchise area were captured in its database, indicating a significant gap in customer enumeration.
Despite these challenges, Kano DisCo’s has been actively working to turn around the DisCo, making notable progress across key areas in 2024. The company has focused on improving its billing efficiency, which increased in 2024 due to multiple CAPEX projects.
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Overcoming force majeure events
In 2024, KEDCO faced two major force majeure events that adversely affected its operations. The Manufacturers Association of Nigeria (MAN) lawsuit and the vandalization of a transmission line disrupted collections and power supply.
The MAN lawsuit, which initially targeted Kano DisCo, led to the withholding of payments for two months due to an increase in the Band A tariff. This lawsuit severely impacted collections, and Kano DisCo is still pursuing MAN arrears from 2024. However, Kano DisCo drove resolution with courts, averting significant issues from affecting the broader DISCO group.
The vandalization of the 330kV Shiroro-Mando transmission line disrupted 100 percent of the supply to Kano DisCo network for 19 days. This was followed by three months of partial supply, poor voltage quality, and frequent power interruptions. These technical issues resulted in the attrition of MD industrial customers, setting Kano DisCo back from its initial progress in bringing customers back to the grid.
Record market settlement rate
Despite these challenges, Kano DisCo achieved a high market settlement rate in months unaffected by external shocks. The company is on track to meet 100 percent of its market obligations in January 2025, with a 100 percent remittance target for Q1 2025.
A closer look at the remittance metrics reveals a holistic view of Kano DisCo’s performance. In the full year of 2024, Kano DisCo recorded a market remittance rate of 74.89 percent, ranking 9th among DisCos. However, when force majeure months are excluded, Kano DisCo’s market remittance rate increases to 84.08 percent, positioning it at 7th place. In the fourth quarter of 2024, Kano DisCo’s market remittance rate further improved to 94.34 percent ranking 5th overall.
This remarkable improvement in market remittance rate demonstrates Kano DisCo’s commitment to meeting its financial obligations and ensuring the sustainability of the energy market.
Path to 100% Remittance
Kano DisCo is on track to meet 100 percent of its market obligations in January 2025, with a 100 percent remittance target for Q1 2025. This achievement would signify a major milestone for the company and demonstrate its financial turnaround.
In January 2025, Kano DisCO’s energy delivered was 121 GWh, with a market invoice of ₦4,524 million. After total fixed deductions of N2,520 million, the expected revenue collected was N7,154 million, resulting in a surplus of N110 million. This positive trajectory indicates that KEDCO is gaining momentum and is well-positioned for future success.
Strategic Initiatives for Improvement
Kano DisCo has implemented several strategic initiatives to strengthen its resilience and position itself for success in a cost-reflective regime. These initiatives focus on unlocking the potential of both MD and non-MD segments, as well as strengthening the organization.
To unlock the potential of the MD segment, Kano DisCo has invested N1 billion to accelerate smart metering and reduce losses, resulting in an improvement in billing efficiency. The company has also expanded supply to the critical industrial corridor, Dawanau International Market, which is expected to increase annual revenue by over NGN1 billion. Additionally, Kano DisCo is integrating all MD meters into the AMI to enable real-time monitoring of energy flow and mitigate billing losses.
To unlock the potential of the non-MD segment, Kano DisCo is enumerating 1.5 million customers to ensure proper energy accountability and effective fund utilisation of government schemes. This enumeration project, which commenced in February 2025, aims to capture and validate active customers, enhance energy accountability, improve technical planning, and ensure effective utilization of government schemes.
As of the latest update, Kano DisCo has captured or validated 74,586 active customers and geotagged 352 distribution transformers with all enumerated customers properly aligned.
Read also: Kano DisCo to install 4,000 free prepaid meters
Strengthening People and Organization
Kano DisCo has also focused on strengthening its people and organization by hiring key personnel and optimizing its structure. The company has strengthened its C-Suite by hiring a CTO, CFO, and CCO with strong track records. Additionally, Kano DisCo is strengthening its N-2 organization and below by optimizing the organizational structure, upskilling employees, and instituting a performance management system.
Strategic Initiatives for Improvement
Kano DisCo has implemented several strategic initiatives to enhance its performance, improve service delivery, and ensure long-term sustainability. These projects are designed to address key challenges and unlock the company’s potential.
Customer Enumeration: Kano DisCo commenced an enumeration project in February 2025 to capture and validate over 1.5 million active customers by Q3 2025. This is a critical exercise, as the company had previously captured only 664,000 active customers, representing less than 15 percent of the households in its franchise area.
The enumeration project will enhance energy accountability, reduce commercial losses, improve technical planning, and ensure the effective utilization of government schemes. The enumeration involves door-to-door data capture, including geospatial location, customer identification number (CIN), meter number, national identification number (NIN), and linking customers to unique bank account numbers for bill payment. As of the report, Kano DisCo has captured or validated 74,586 active customers and geotagged 352 distribution transformers (DTs).
Metering Emergency and Metering Plan Reinforcement: Kano DisCo has declared a metering emergency in its network and reinforced its metering plan to address the challenge of low metering coverage and its resultant energy accounting and billing losses. The company is deploying smart meters for MD industrial customers and has installed 99 smart HV meters in 2024 to replace obsolete meters on MD industrial feeders with the biggest billing losses.
This initiative has already shown positive results, with a 7 percent impact on overall billing efficiency.
Kano DisCo is also accelerating plans to mass-meter customers and DTs through the Presidential Metering Initiative (PMI), Distribution Sector Recovery Program (DISREP), Meter Acquisition Fund (MAF), and direct FEA investment.
Additionally, Kano DisCo has passed a new policy requiring all smart meters in the network to be integrated into the AMI network launched last year. The company is also launching new monitoring protocols, including setting up a data room for AMI, establishing and upskilling watchdogs to monitor feeders and customer meters, and ensuring that meters are frequently calibrated.
Dawanau Line Commissioning: Kano DisCo is commissioning the Dawanau line in March, a project expected to have significant financial and economic impact in Kano. The Dawanau market is the largest international grain hub in sub-Saharan Africa, but its growth potential has been constrained by inadequate electricity supply. FEA invested ₦1.1 billion to integrate Dawanau into its network expansion plan and increase the electricity supply from less than 4 hours per day to a minimum of 20 hours per day. This project is expected to unlock ₦2.4 billion in incremental revenue for KEDCO in 2025 and increase electricity capacity by 10MW for over 400 businesses, including medium and large-scale agro-processing plants. The increased power supply will reduce operating costs and support the growth of these businesses.
Conclusion
Kano DisCo’s journey to achieve a record market settlement rate amidst numerous challenges is a testament to its resilience, strategic planning, and operational efficiency. The company’s commitment to improving its infrastructure, enhancing customer enumeration, and strengthening its organization has yielded positive results.
While Kano DisCo faced significant setbacks in 2024, including the MAN lawsuit and the vandalization of a transmission line, it demonstrated its ability to overcome these obstacles and achieve remarkable progress. The company’s focus on strategic initiatives, such as smart metering, network expansion, and customer enumeration, has positioned it for continued success in the future.
Kano DisCo’s achievements not only benefit the company and its customers but also contribute to the overall growth and development of the energy sector in Nigeria. By ensuring a sustainable and reliable electricity supply, Kano DisCo is playing a vital role in supporting economic activities, improving the quality of life, and fostering development in its franchise area.