…NISO cuts N8b monthly transmission losses to 7.05%
By Seun Ibiyemi
A report by the Nigerian Electricity Regulatory Commission (NERC) has revealed that Nigerian consumers defaulted on electricity payments exceeding ₦63.46 billion to Distribution Companies (DisCos) in January 2026.
This is even as Nigerian System Operator (NISO) revealed that it has reduced transmission losses which stood at 10 per cent, gulping N8 billion monthly, to 7.05 per cent.
According to data seen on NERC, despite a total billing of ₦268.20 billion issued to consumers in January 2026, the eleven Distribution Companies (DisCos) managed to collect only ₦204.74 billion leaving a staggering ₦63.46 billion unrecovered in a single month.
This collection efficiency of 76.34 per cent highlights a persistent bottleneck that continues to stifle the industry’s ability to fund critical infrastructure upgrades.
The gap between energy billed and cash collected creates a domino effect across the value chain, limiting the DisCos’ capacity to settle obligations with generation companies and the Transmission Company of Nigeria.
While the industry saw a slight growth in energy received, the inability to convert that energy into liquid revenue remains the sector’s achilles heel.
The disparity in regional collection performance further complicates the national outlook.
While operators like Ikeja and Eko DisCos maintained relatively high collection efficiencies of 87.77 per cent and 87.55 per cent respectively, other regions struggled significantly.
The situation is particularly critical in Jos where the collection efficiency fell to 47.74 per cent and Kaduna which recorded 50.94 per cent.
These figures indicate that in certain parts of the country, nearly half of the electricity supplied is effectively being consumed without payment, undermining the commercial viability of those regional grids.
This revenue shortfall is further compounded by the difference between the regulated price of power and actual recovery.
While the allowed average tariff stands at ₦124.30 per kWh, the actual average collection was a mere ₦85.97 per kWh.
This 30 per cent collection gap per unit of electricity suggests that until metering gaps are closed and collection mechanisms are modernized, the Nigerian power sector will continue to operate under a heavy financial deficit, regardless of how much electricity is generated or transmitted.
Also, Nigerian System Operator (NISO) revealed that it has reduced transmission losses which stood at 10 per cent, gulping N8 billion monthly, to 7.05 per cent.
NISO’s Managing Director, Engr. Abdu Bello Mohammed made this known yesterday in Abuja at the first anniversary ceremony of organisation.
He also revealed that the Nigerian Electricity Regulatory Commission (NERC) has ordered the distribution companies (DisCos) to install Internet of Things (IoT) meters on their 33kV and 11kV feeders.
His words: “One of the greatest problems we encounter at the inception of NISO is that we recorded a very high transmission loss factor. At some point, it was close to 10 per cent, costing about five to N8b in a month.
“We are working earnestly and we have reduced it to our 7.05 at the moment.And we are working to also reduce it further to five or six percent so that we will meet the target of the latest.”
He said the interventions are contributing to improve system discipline and reliability together.
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Mohammed revealed that in order to ensure grid stability, NISO is working closely with the Transmission Company of Nigeria (TCN), Transmission Service Provider (TSP), Generation Companies (GenCos), Distribution Companies (DisCos) to advance the implementation of the free- governor model of the generating units.
This, according to him, is to ensure the frequency response of the grid. He said with the backing order from the Nigerian Electricity Regulatory Commission (NERC) NISO is already enforcing the free- governor model.
Some GenCos, said Mohammed have complied with the enforcement of model that is expected to enhance grid reliability while some have refused to abide by it.
NISO boss said, “At the core of our mandate in ensuring a stable and resilient grid, we are working very closely with the transmission company of Nigeria, transmission service providers, our generation companies, and the distribution companies to advance implementation of the free-governor model operations of the generating units to improve frequency response.”
“You will agree with me that a stability and reliability of the grid is a contributory factor. It is expected that the generators, transmission, and distribution companies will provide certain reliability services, one of which, and one of the most important, is the free-governor model operations of the generating units.
“And we have an order of the commission by enforcing on this. Substantially, a number of the generating units have complied with this, and we have seen a lot of improvement on the stability of the frequency, system frequency, thereby improving the grid reliability in general. However, some generators have failed to abide by this provision, and we are going to the level of enforcement.”
Mohammed said currently the Nigerian Electricity Supply Industry (NESI) is operating manually, but with the telemetry system, it can have hourly settlements.
He vowed that NISO has planned to configure the settlement system, noting that other electricity market platforms are developed to enhance data acquisition and real-time trading in the country.
He further said NISO has also strengthened the data acquisition, validation, and utilisation on real-time basis using its Internet of Things (IoT) scheme, and part of the completed Supervisory Control and Data Acquisition (SCADA) EMS.
Mohammed said in the last one year, NISO has expanded the system in terms of accuracy and management of data with the application of the IoT metering system that were installed on most part of the generating units and at the interfaces between transmission and generation, and also on some key transmission lines and substations.
He said eventually, the NESI is expected to have visibility of the national grid from generation through transmission lines of stations and distribution.
He vowed that at the end of the project, there shall be end-to-end visibility of the system from generation through transmission, distribution, and eligible customers, thereby enabling the system operators, market operators, have visibility on real-time basis and enhancing effective management of the grid.
