Amid blackouts: NERC, experts clash as DisCos’ revenue rises to N1.7trn
The Nigerian Electricity Regulatory Commission (NERC) and industry experts seem to have differing views regarding the factors contributing to the rise in revenue for electricity distribution companies, known as DisCos.
NERC has attributed this revenue increase to what it refers to as improved efficiency in revenue collection, whereas experts have pointed to the exploitation of customers.
Experts claim that customers are being charged for electricity that they have not consumed.
In the meantime, electricity distribution companies, or DisCos, have experienced a significant surge in revenue, reaching N1.713 trillion over a nine-month period from January to September 2025.
This marks a 27 percent increase compared to the N1.249 trillion recorded during the same timeframe in 2024.
Furthermore, the most recent report from the Nigerian Electricity Regulatory Commission (NERC) regarding the commercial performance of DisCos revealed that the total revenue collected by these companies in September 2025 alone amounted to N196.26 billion, out of a total of N241.54 billion in energy bills issued during the review period, indicating an unpaid bill of N49.28 billion.
However, the revenue trend indicates that DisCos have consistently increased their revenue on a quarter-by-quarter basis, with N559.3 billion in the first quarter of 2025 (Q1’25), N573.5 billion in the second quarter (Q2’25), and N581.3 billion in the third quarter (Q3’25).
Data from NERC also indicates an improvement in billing and revenue collection efficiency.
According to NERC, billing efficiency was recorded at 86.43%, while revenue collection efficiency stood at 81.25%. Additionally, revenue recovery was notably high, with a recovery efficiency of 83.45%.
NERC highlighted that DisCos such as Eko, Abuja, and Ikeja Electric have demonstrated strong performance in terms of billing, collections, and recovery efficiency.
Aba, as per the fact sheet, achieved an impressive billing efficiency of 102.85%, reflecting enhanced energy optimization and legacy recovery.
In contrast, Benin, Port Harcourt, and Kano exhibited moderate efficiency levels, while Jos, Kaduna, and Yola lagged behind, indicating potential areas for improvement.
Experts react
However, industry experts seem unhappy with the impressive financial performance of the DisCos, especially at the backdrop of unhappy consumers who are paying the bills.
Commenting on the situation, Energy Economist, Professor Wumi Iledare, said, “The anomaly in Nigeria’s electricity pricing structure is what appears to be driving revenue growth-not efficiency, not improved service delivery, and certainly not fairness.
“First, the estimated billing system is deeply problematic, with cross-subsidies embedded in ways that disproportionately burden low-income households. Those who can least afford it end up paying the most for power they often do not receive.
“Second, the Band Pricing approach has created further distortions. I am not aware of any energy pricing framework anywhere in the world that is this inefficient in resource allocation while simultaneously ignoring ethics, equity, and effectiveness.”
Speaking on condition of anonymity, a power sector operator revealed: “NERC has a lot of responsibility in ensuring Nigerians are getting a commensurate services received as utility, as the regulators have the yam and the knife.
“For over 12 years, they have refused to do the needful thereby causing harm across the power sector value chain.”
Similarly, convener and Executive Director of PowerUp Nigeria, a Power Consumer Advocacy Group, Adetayo Adegbemle, said Nigeria’s electricity subsidy was unsustainable as it constituted a huge financial burden on the federal government.
He said: “Historically, the Nigerian government has been paying electricity subsidy to the Nigeria Electricity Supply Industry, NESI. This means there is the cost reflective tariff of supplying 1kWh (kilowatt hour), and the allowed tariff consumers are “allowed” to pay.
“This variance, otherwise called subsidy, has now turned into an elephant in the China ware shop. The subsidy is as a result of government policy consideration on welfarism, targeted at supporting the social welfare of consumers who might not be able to pay the high true cost of the service.
“Economic stability, aimed at ensuring a stable and affordable energy supply, is essential for economic development, and political stability that further aims at mitigating possible social unrest and creating political instability.
“The federal government in 2020, with the introduction of Service Based Tariff, SBT, decided to phase out subsidy on electricity tariff because of the strain it is putting on government finances, and the inefficiencies it promotes in the energy sector.
