Nigeria’s electricity market recorded revenue losses of about N1.36tn in 2025, largely due to poor billing and weak collection by electricity distribution companies, according to the Nigerian Electricity Regulatory Commission.
The figure is contained in NERC’s 2025 Annual Report, which showed that the 11 distribution companies supplied electricity valued at N3.68tn during the year but billed customers for only N2.99tn.
The unbilled electricity was valued at approximately N694.8bn, representing a major gap between the electricity supplied and the revenue captured by the DisCos.
Of the N2.99tn billed to consumers, the companies collected N2.32tn, leaving about N669.5bn unpaid.
NERC said the DisCos achieved a collection efficiency of 77.60 per cent, while their overall billing efficiency stood at 81.14 per cent.
The commission also reported that the companies received 31,251.77 gigawatt-hours of electricity at their trading points but accounted for only 25,867.86GWh through customer billing.
Ibadan Electricity Distribution Company recorded the strongest energy accounting performance at 88.84 per cent, while Enugu DisCo posted the lowest at 72.18 per cent.
The sector’s financial challenges were further reflected in the combined technical, commercial and collection losses recorded by the DisCos. NERC put the weighted average aggregate loss at 37.03 per cent, significantly higher than the 20.54 per cent target set under the 2025 Multi-Year Tariff Order.
The losses consisted of technical and commercial losses of 18.86 per cent and collection losses of 22.40 per cent.
Former Senator Ben Murray-Bruce, commenting on the figures, criticised the performance of Nigeria’s electricity privatisation programme and questioned whether the current structure had delivered the improvements promised when the sector was privatised.
He argued that many investors who acquired generation and distribution assets lacked the capital needed to modernise and expand the infrastructure.
Murray-Bruce also raised concerns about the continued reliance on estimated electricity billing, noting that millions of customers remained without meters.
NERC reported that Nigeria had 12.16 million active registered electricity customers at the end of 2025. Only 6.97 million, representing 57.27 per cent, had been metered, leaving about 5.20 million customers without meters.
The DisCos installed 972,040 meters during the year. Ibadan recorded the highest number of installations with 180,256 meters, while Yola had the lowest at 14,231.
The liquidity crisis also extended to transactions between DisCos and other players in the electricity market.
According to NERC, the Nigerian Bulk Electricity Trading Company and the market operator issued invoices totalling N1.72tn to the DisCos for electricity and administrative services in 2025. The companies remitted N1.632tn, resulting in a shortfall of N89.58bn.
Government intervention remained significant during the year, particularly through electricity subsidies.
NERC said the Federal Government’s subsidy obligation reached N1.93tn in 2025, representing 57.44 per cent of the N3.357tn total NBET invoice.
The commission attributed the high subsidy burden largely to the government’s decision to keep customer tariffs below cost-reflective levels despite rising electricity supply costs.
Murray-Bruce called for a major rethink of the electricity market, arguing that continued government funding had not produced reliable power for Nigerians.
He proposed greater involvement of communities, estates and state governments in electricity generation and distribution, particularly through metered solar power systems.
The NERC report also recorded two grid disturbances in 2025. There was a full system collapse on September 10, while a partial collapse occurred on December 29 following a problem involving one circuit breaker on the Benin-Onitsha 330kV transmission line at the Benin transmission station.
The latest figures highlight the financial difficulties facing Nigeria’s electricity industry, with poor billing, unpaid bills, distribution losses, inadequate metering and market payment gaps continuing to undermine the sector’s ability to generate enough revenue to support its operations.
With more than 40 per cent of active customers still unmetered and billions of naira worth of electricity going unbilled or uncollected, improving revenue assurance remains a major challenge for the power sector.
