By Seun Ibiyemi
Nigeria’s electricity Distribution Companies (DisCos) failed to collect N669.49 billion from customers who were billed for electricity in 2025, highlighting persistent revenue challenges in the power sector.
The figure was contained in the 2025 Annual Report of the Nigerian Electricity Regulatory Commission (NERC), which showed that DisCos billed customers N2.99 trillion during the year but collected only N2.32 trillion.
The N2.32 trillion collected represented a 77.60 per cent collection efficiency, meaning DisCos failed to recover about N22.40 for every N100 billed to consumers.
NERC said the DisCos supplied electricity valued at N3.68 trillion during the year, but only N2.99 trillion worth of the energy was billed, resulting in a gross billing efficiency of 81.14 per cent.
This means electricity worth approximately N694.80 billion was supplied but not billed to customers.
The regulator said the value of unpaid electricity bills increased significantly during the year, rising from N536.95 billion in 2024 to N669.49 billion in 2025.
The N132.54 billion increase represents a 24.7 per cent year-on-year rise, further highlighting the financial pressures facing electricity distribution companies.
NERC warned that persistent weaknesses in billing and collection were undermining the liquidity of the Nigerian Electricity Supply Industry (NESI) and limiting the sector’s ability to attract and support new investments.
“The total billing to electricity consumers by the DisCos was N2,988.30 billion, but only N2,318.81 billion was collected, translating to a collection efficiency of 77.60 per cent,” the regulator stated.
The revenue challenge also extended to DisCos’ obligations to the electricity market.
According to NERC, the Nigerian Bulk Electricity Trading Plc (NBET) and Market Operator issued gross invoices of N1.72 trillion to DisCos in 2025 for energy and administrative services.
DisCos remitted N1.63 trillion, representing 94.80 per cent of their obligations and leaving a market shortfall of N89.58 billion.
The regulator classified the outstanding amount as an underpayment by market participants.
The development comes amid ongoing reforms following the implementation of the Electricity Act 2023, which replaced the Electric Power Sector Reform Act 2005.
The law, signed by President Bola Ahmed Tinubu in June 2023, removed electricity from the Exclusive Legislative List, allowing states and private entities to participate more directly in electricity generation, transmission and distribution.
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The reforms are aimed at increasing competition, attracting investment and expanding electricity access across the country.
NERC has also introduced measures to strengthen consumer protection, including directives requiring DisCos to complete refunds under amended regulatory orders within 12 months, with the refunds applied directly to affected customers’ electricity bills.
The latest figures, however, underscore the need to improve metering, billing and collection efficiency if the sector is to achieve greater financial sustainability and attract the investment required to expand electricity supply.
