The Nigerian Electricity Regulatory Commission (NERC) and sector experts are at odds over the factors behind the surge in revenue recorded by electricity distribution companies (DisCos), even as consumers continue to experience frequent blackouts nationwide.
NERC attributes the rising revenue to improved billing and collection efficiency, but industry specialists insist the increase stems from customer exploitation and payments for unconsumed electricity.
Latest figures show that DisCos generated N1.713 trillion between January and September 2025—27 per cent higher than the N1.249 trillion recorded in the same period of 2024. In September alone, DisCos collected N196.26 billion out of N241.54 billion billed, leaving N49.28 billion unpaid.
The revenue has grown consistently quarter by quarter, with N559.3 billion collected in Q1 2025, N573.5 billion in Q2, and N581.3 billion in Q3. NERC’s commercial performance report further indicates a billing efficiency of 86.43 per cent, revenue collection efficiency of 81.25 per cent, and a recovery efficiency of 83.45 per cent.
According to NERC, DisCos such as Eko, Abuja and Ikeja Electric maintained strong performance across billing and collections, while Aba achieved an exceptional billing efficiency of 102.85 per cent. Benin, Port Harcourt and Kano recorded moderate performance, whereas Jos, Kaduna and Yola lagged significantly.
The commission said the data reflects “how effectively DisCos are billing, collecting and recovering revenue,” noting that these metrics are critical for improving liquidity and service delivery in the Nigerian Electricity Supply Industry (NESI).
Experts Fault Revenue Growth
Several experts, however, have criticised the revenue surge, arguing that it is not supported by improved supply or fair billing.
Energy economist Professor Wumi Iledare said the rise is driven by flaws in the pricing system rather than operational efficiency. He described estimated billing as “deeply problematic,” adding that the structure unfairly burdens low-income consumers who often pay for electricity they do not receive.
He also condemned the Band Pricing model, stating: “I am not aware of any energy pricing framework anywhere in the world that is this inefficient in resource allocation while ignoring ethics, equity and effectiveness.”
A power operator, who spoke anonymously, accused NERC of failing to enforce standards across the sector. “For over 12 years, they have refused to do the needful, causing harm across the power value chain,” he said.
Executive Director of PowerUp Nigeria, Adetayo Adegbemle, argued that electricity subsidies remain unsustainable and continue to strain the Federal Government’s finances. He noted that the introduction of the Service-Based Tariff (SBT) in 2020 was intended to gradually eliminate subsidies due to the inefficiencies they create.
He explained that the subsidy gap—caused by the difference between cost-reflective tariffs and what consumers are permitted to pay has grown into “an elephant in a China shop,” posing economic and political risks if not addressed.
