Privatisation and the Operational Performance of Electricity Distribution in Nigeria: Technical Performance and Metering Penetration of the Abuja Electricity Distribution Company, 2013–2024

Abstract

This study examined the operational performance of the Abuja Electricity Distribution Company (AEDC) after its privatisation in November 2013, focusing on two outcomes that the reform was expected to improve: technical performance and metering penetration. It was anchored on Principal–Agent Theory, which predicts that transferring ownership to private investors strengthens the incentive to reduce losses, improve supply reliability and extend metering. An explanatory mixed-methods design with a longitudinal component was adopted, comparing post-privatisation performance with the pre-privatisation baseline. Quantitative data were obtained from 432 electricity consumers and staff drawn by stratified random sampling across AEDC’s franchise in the Federal Capital Territory and Niger, Nasarawa and Kogi States, and from regulatory and company records on aggregate technical, commercial and collection (ATC&C) losses, reliability and metering. Qualitative data came from key informant interviews. Data were analysed with mean, standard deviation, Welch’s independent-samples t-test and one-sample t-tests at the 0.05 level of significance. The findings showed that ATC&C losses fell significantly from 52.70% at handover to a post-privatisation mean of 44.61% (t(5) = −4.36, p = .007), and that the System Average Interruption Duration Index at the Apo substation fell from 112.85 to 97.91 hours per customer per year (t(6.19) = 2.71, p = .034), but interruption frequency did not change significantly (p = .518). Consumers nevertheless rated technical performance negatively on seven of eight items. The post-privatisation mean metering rate (54.75%) did not differ significantly from the 2012 baseline of 48.07% (t(9) = 2.11, p = .064); metering fell to 42.68% in 2016 before rising to 76.20% in 2024. The study concluded that privatisation produced partial and delayed operational gains rather than the rapid transformation envisaged. It recommended franchise-wide publication of reliability indices, targeted network rehabilitation, blended financing for meter deployment and strict enforcement of estimated-billing safeguards.