International Electricity Customers Owe Nigeria $8.84 Million, NERC Report Reveals
ABUJA, Nigeria – A recent report released by the Nigerian Electricity Regulatory Commission (NERC) has exposed a significant financial deficit in the nation’s power sector, with international customers owing Nigeria $8.84 million for electricity supplied in the fourth quarter of 2024.
The NERC report detailed that six international bilateral customers, who receive power from Nigeria’s grid-connected Generation Companies (GenCos), were billed a total of $14.05 million by the Market Operator. However, these customers only remitted $5.21 million, leaving a substantial unpaid balance.
This issue is not confined to international customers. Domestic bilateral customers also fell short of their payment obligations, with an outstanding balance of N724.44 million from a total invoice of N1.977 billion.
Domestic Challenges Persist
Further exacerbating the financial strain, Nigeria’s Distribution Companies (DisCos) reported a revenue shortfall exceeding N146 billion for the same period. DisCos billed customers N658.4 billion but collected only N509.84 billion, resulting in a collection efficiency of 77.44 percent. While this shows a slight improvement from the previous quarter, the revenue gap remains a critical concern.
Additionally, DisCos faced cumulative upstream invoice payables of N408.86 billion, owed to the Nigerian Bulk Electricity Trading Company (NBET) and the Market Operator (MO). Despite remitting N378.93 billion, an outstanding balance of N29.92 billion remains, indicating a remittance performance of 92.68 percent.
Operational Inefficiencies
The report also highlighted operational inefficiencies within the DisCos. They received 7,420.58 gigawatt-hours (GWh) of electricity but only billed end-users for 6,207.84 GWh, resulting in a billing efficiency of 83.66 percent.
Impact and Outlook
While there have been marginal improvements in collection and remittance rates, the persistent revenue shortfalls and mounting debts from both international and domestic customers continue to threaten the financial stability of Nigeria’s power sector. The NERC report underscores the urgent need for stricter enforcement of payment obligations and improved operational efficiency to ensure the sector’s sustainability.
