Electricity Distribution Companies Bill Nigerians Billions Despite Persistent Power Supply Issues
Electricity distribution companies in Nigeria generated a combined revenue of N630.93 billion during the fourth quarter of 2025, according to the latest market report released by the Nigerian Electricity Regulatory Commission. This substantial amount was realized from a total billing of N795.06 billion within the same period, reflecting a collection efficiency rate of 79.36 percent.
Declining Collection and Billing Efficiency
The report reveals that the 79.36 percent collection rate represents a slight decline when compared to the 80.70 percent recorded in the third quarter of 2025. This indicates that distribution companies collected a smaller proportion of billed revenue during the period under review, despite continuing to issue substantial bills to consumers across the nation.
Billing performance also showed a marginal decline, with the total value of energy supplied to distribution companies standing at N969.19 billion in Q4 2025. Out of this amount, N795.06 billion was billed to customers, translating to a billing efficiency of 82.03 percent. NERC noted that this figure dropped from the 82.69 percent recorded in the previous quarter, highlighting ongoing challenges in the electricity distribution sector.
Substantial Billing Losses Recorded
The commission disclosed that electricity distribution companies recorded cumulative billing losses of N174.12 billion during the quarter. These significant losses arise from the inability of distribution companies to fully account for energy delivered to customers, as well as persistent challenges in collecting payments for billed electricity from consumers across various regions.
Total billing losses have become a recurring issue within Nigeria's power sector, with distribution companies struggling to improve their collection mechanisms while consumers continue to experience unreliable electricity supply. The gap between billed amounts and actual collections represents a substantial financial challenge for the entire electricity value chain.
Performance Targets Mostly Missed
The report further stated that Aggregate Technical, Commercial and Collection losses across all distribution companies averaged 34.90 percent in Q4 2025. This comprehensive metric includes 17.97 percent in technical and commercial losses, alongside 20.64 percent in collection losses, painting a picture of systemic inefficiencies within the distribution network.
NERC added that most distribution companies failed to meet their performance targets during the quarter, with only Eko Electricity Distribution Company successfully meeting its ATC&C benchmark. In stark contrast, Kaduna Electricity Distribution Company recorded the poorest performance, with an actual loss level of 69.45 percent compared to its target of 21.32 percent.
Power Supply Remains Unstable
This financial reporting comes against a backdrop of continued electricity supply challenges across Nigeria. Despite assurances from the Minister of Power that outages would ease within specific timelines, power generation has remained below expected levels for extended periods. Supply has continued to fluctuate between 3,000 and 4,000 megawatts, leaving numerous households and businesses without stable electricity.
Widespread blackouts in recent weeks have been largely attributed to gas shortages affecting thermal power plants, with distribution companies issuing repeated apologies and promises of improvements that have yet to be fully realized. The disconnect between substantial billing and unreliable service delivery continues to fuel consumer frustration and calls for sector reform.
The NERC report highlights the ongoing challenges facing Nigeria's electricity distribution sector, where financial performance metrics show declines even as consumers continue to experience unreliable power supply. With only one distribution company meeting its performance targets and substantial billing losses persisting, the need for improved operational efficiency and service delivery remains pressing for the nation's power sector.
