Nigeria’s electricity sector lost an estimated ₦200 billion in the first quarter of 2025 due to persistent inefficiencies across the value chain, from generation to revenue collection, according to the latest report from the Nigerian Electricity Regulatory Commission (NERC).
The Commission’s data paints a troubling picture, highlighting revenue drain from poor metering, unbilled energy use, nationwide system collapses, and widespread ATC&C (Aggregate Technical, Commercial and Collection) losses among the country’s 11 electricity distribution companies (DisCos).
In Q1 2025, a total of ₦349.55 billion worth of electricity was billed to consumers, but only ₦291.62 billion was collected reflecting a 16.57% collection shortfall. On top of that, over 1.5 terawatt-hours (TWh) of electricity valued at ₦56 billion was not billed at all.
When losses from unutilized energy due to grid collapse and transmission failures are included, the total financial shortfall exceeds ₦200 billion, based on NERC’s energy value benchmarks.
The biggest casualties of the broken system are the generation companies (GenCos) and gas suppliers, who continue to suffer from delayed and incomplete payments, despite having fulfilled supply obligations. Several GenCos disclosed they received only partial payments for energy delivered within the quarter.
These financial pressures threaten not only electricity supply reliability but also the sustainability of the entire energy chain.
Despite the alarming losses, NERC says it is intensifying regulatory enforcement. In a statement, the Commission disclosed ongoing audits of underperforming DisCos and the introduction of tougher financial penalties aimed at improving performance.
“We are applying stronger financial penalties and have begun auditing the most underperforming DisCos,” NERC stated. “Our focus is to recover value for every unit of energy generated.”
As the sector continues to grapple with liquidity challenges and technical breakdowns, analysts warn that unless urgent reforms take root, the country’s power woes could worsen in the coming quarters.
