A recent quarterly report from the Nigerian Electricity Regulatory Commission (NERC) has revealed that Electricity Distribution Companies (DisCos) were unable to account for N167.25 billion worth of energy they received during the second quarter of 2025.
The report, released recently, highlighted a significant and concerning gap between the total value of energy offtaken by the DisCos and the amount they ultimately billed to customers and collected, raising serious questions about operational efficiency within the national electricity supply chain.
The data shows that the total naira value of energy offtake by all DisCos stood at N909.59 billion. However, only N742.34 billion of this was actually billed to consumers, resulting in a billing efficiency of 81.61%.
Furthermore, out of this billed amount of N742.34 billion, the DisCos managed to collect only N564.71 billion from their customers. This yielded a collection efficiency of 76.07%, which represents a slight improvement over the performance recorded in the previous quarter.
NERC also disclosed that the cumulative upstream invoice payable by the DisCos—covering costs for generation from the Nigerian Bulk Electricity Trading Plc (NBET) and for transmission and administrative services by the Market Operator—amounted to N417.35 billion. Despite this obligation, the DisCos remitted a total of N399.20 billion to the market in Q2 2025. This represents a 95.65% remittance performance, which is marginally lower than the 95.86% recorded in the first quarter.
A critical performance metric, the weighted average Technical, Commercial, and Collection (ATC&C) loss across all DisCos, was recorded at 37.92%. This figure far exceeds the 2025 Multi-Year Tariff Order (MYTO) target of 20.54%. This overall loss is composed of 18.39% in technical and commercial losses (from faulty infrastructure and theft) and 23.93% in collection losses (from customers not paying bills). NERC estimated that this high level of loss translated to a revenue shortfall of approximately ₦158.05 billion.
Although the ATC&C loss showed a slight improvement of 1.69 percentage points compared to Q1, the report emphasized that most DisCos still failed to meet their specific loss reduction targets. Kaduna Electricity Distribution Company showed the worst performance, with an actual loss of 70.98% against a target of 21.32%. Eko Electricity Distribution Company was the sole utility to meet its regulatory target during the quarter.
The report also noted challenges in payments from bilateral customers. International bilateral customers settled $9.015 million out of an invoiced $17.54 million (a 51.33% remittance rate), while domestic bilateral customers paid N1.40 billion against an invoice of N2.80 billion (a 50.10% remittance rate), further underscoring the pervasive challenges in market payments and revenue collections.
NERC, which was established by the Electricity Act of 2023, continues its mandate to regulate Nigeria’s electricity supply industry, aiming to ensure a stable, efficient, and investor-friendly electricity market amidst these ongoing and significant collection and billing inefficiencies by the DisCos.
