Nigeria’s electricity distribution companies recorded combined revenue losses of nearly N93bn in October 2025, fresh data from the Nigerian Electricity Regulatory Commission has revealed, exposing persistent vulnerabilities that continue to undermine the financial health of the country’s beleaguered power sector.
The eleven distribution companies, known as DisCos, received electricity valued at N303.85bn from the national grid during the month but managed to collect only N210.92bn from customers—a staggering shortfall that reflects systemic weaknesses in both billing infrastructure and revenue collection mechanisms.
The losses manifested in two distinct but interconnected failures. First, the DisCos billed customers just N255.19bn out of the N303.85bn worth of power they received, leaving N48.66bn in energy supplied but never captured in customer bills. This pushed industry-wide billing efficiency down to 83.99 percent, meaning that more than one in every six naira worth of electricity delivered simply vanished from the books.
Second, even where bills were issued, collection remained problematic. Of the N255.19bn billed, the DisCos failed to recover N44.27bn from customers, pointing to a combination of payment defaults, inadequate enforcement, and, likely, continuing resistance to tariff increases among consumers.
The cumulative effect of these twin failures left the sector with an overall recovery efficiency of just 82.49 percent—a metric that measures the proportion of allowed revenue actually realized by operators.
According to NERC, while the regulated average tariff for October stood at N116.25 per kilowatt-hour, the actual average collection dropped to approximately N95.85/kWh, representing a 1.23 percent decline from the previous month. This widening gap between what DisCos are permitted to charge and what they actually collect continues to fuel severe liquidity pressures across the entire electricity value chain.
The October figures exposed stark regional and operational disparities among the distribution companies.
Ikeja Electricity Distribution Company emerged as the clear frontrunner, achieving a billing efficiency of 94.36 percent and an exceptional collection efficiency of 102.07 percent—the latter figure reflecting aggressive recovery of outstanding debts from previous months. The company’s overall recovery efficiency hit 108.17 percent, setting the standard for the industry.
Eko DisCo maintained its position among the strongest performers, posting a billing efficiency of 95.71 percent and collecting N37.67bn, translating to a collection efficiency of 93.50 percent. Its recovery efficiency stood at 101.65 percent.
Abuja DisCo, despite a sharp 5.75 percentage-point decline in billing efficiency to 84.05 percent, managed to achieve a collection efficiency of 88.35 percent, demonstrating relatively robust revenue protection mechanisms.
However, the picture in several northern states painted a dramatically different story.
Jos DisCo recorded the sector’s worst performance, managing to collect only N5.26bn out of N13.50bn billed—a dismal collection efficiency of just 38.98 percent that plummeted 18.19 percentage points from September. Its recovery efficiency collapsed to 42.28 percent, suggesting that more than half the energy it distributed yielded no revenue.
Kaduna DisCo, while showing improvement in billing efficiency to 84.62 percent, collected barely 43.03 percent of what it billed, leaving recovery efficiency at 43.70 percent.
Other utilities, including Yola, Benin, and Kano DisCos, remained trapped in what NERC classifies as the “amber zone” for recovery performance, with persistent commercial inefficiencies threatening their operational sustainability.
The October performance data arrives at a critical juncture for Nigeria’s power sector, which has undergone significant regulatory and structural reforms in recent years. NERC has consistently emphasized the urgency of improved metering infrastructure, aggressive action against energy theft, and stricter enforcement of commercial performance standards.
Despite recent tariff adjustments and reforms introduced under the amended Electricity Act, the latest figures suggest that fundamental challenges remain unresolved. Poor energy accounting systems, incomplete customer enumeration, and weak revenue protection continue to drain billions from the sector monthly.
The persistent losses have serious knock-on effects throughout the electricity value chain. With DisCos struggling to collect revenue, their ability to remit payments to the Nigerian Bulk Electricity Trading Company—which procures power from generation companies—is severely compromised. This creates a liquidity crisis that ripples backward, affecting generation companies’ ability to pay for gas supplies and maintain infrastructure.
Industry analysts warn that without urgent intervention to address the dual crisis of unbilled energy and uncollected revenue, the sustainability of Nigeria’s power sector reforms remains in serious doubt. The country’s aspirations for energy security and economic development, they argue, cannot be realized while more than N90bn worth of electricity disappears from the commercial system every month.
The challenge for policymakers and regulators is clear: closing the gap between energy delivered and revenue collected is no longer merely a commercial imperative—it has become an existential necessity for the Nigerian power sector.
WHAT YOU SHOULD KNOW
Nigeria’s power sector lost nearly N93bn in October 2025 as distribution companies failed to bill N48.66bn worth of electricity supplied and couldn’t collect another N44.27bn from customers who were billed. This means that for every N100 worth of power delivered, only N69 was actually recovered as revenue.
The crisis reveals a two-headed problem: outdated infrastructure that can’t track energy usage and widespread payment defaults by customers. While Lagos-area utilities like Ikeja and Eko DisCos achieved collection rates above 93%, northern utilities like Jos and Kaduna DisCos collected less than 44% of what they billed.
