New data from Nigeria's electricity regulatory body has exposed a significant financial gap in the distribution segment of the power sector, with companies failing to collect billions of naira from customers despite improvements in operational efficiency.
September 2025 Performance Overview
The Nigerian Electricity Regulatory Commission (NERC) released its commercial performance factsheet for September 2025, revealing that distribution companies (DisCos) recorded a substantial revenue shortfall of N45.28 billion. According to the report, DisCos billed customers N241.54 billion but only managed to collect N196.26 billion during the month.
While the DisCos received energy worth N279.45 billion in September, their billing efficiency stood at 86.43 percent, representing a 2.58 percentage-point improvement compared to August 2025. The collection efficiency during the same period reached 81.25 percent, showing a 1.18 percentage-point increase from the previous month.
Wide Performance Disparities Among DisCos
The factsheet highlights significant variations in performance across the eleven electricity distribution companies. Three DisCos demonstrated exceptional collection efficiency levels: Ikeja DisCo led at 96.43 percent, followed by Eko DisCo at 94.40 percent, and Benin DisCo at 91.90 percent.
However, three companies recorded concerningly low collection rates that substantially contributed to the national revenue gap. Kaduna DisCo managed only 40.48 percent collection efficiency, while Kano DisCo achieved 62.46 percent and Yola DisCo recorded 67.95 percent.
In terms of billing efficiency, the top performers included Aba at 102.85 percent, Eko at 99.04 percent, and Ikeja at 96.46 percent. Meanwhile, Benin and Yola recorded the weakest billing outcomes at 65.25 percent and 65.36 percent respectively.
Tariff Recovery and Financial Implications
The regulatory data also provided insights into tariff recovery patterns. The allowed average tariff for September stood at N116.34 per kilowatt-hour, while the actual average collection was N97.09 per kWh. This resulted in a recovery efficiency of 83.45 percent, marking a 3.67 percentage-point improvement compared to August.
Recovery efficiency varied dramatically across distribution companies, with Eko DisCo achieving an impressive 106.20 percent, followed by Ikeja at 104.47 percent and Abuja at 87.66 percent. On the opposite end, Kaduna DisCo recorded only 36.89 percent recovery efficiency, with Benin at 71.45 percent and Yola at 74.88 percent also trailing behind.
Despite the month-on-month improvements in billing efficiency, collection efficiency, and recovery efficiency, the substantial N45 billion revenue shortfall between billed amounts and actual collections indicates ongoing financial pressures within Nigeria's electricity distribution value chain.
