The N1.13trn payment amid blackouts

THERE is a reason why the recent report indicating that electricity distribution companies in the country raked in a whopping N1.13tn from their disgruntled customers from April to September 2005 despite repeated complaints about low power supply and incessant cases of blackouts in many locations nationwide is not surprising. Nigerians are used to being mercilessly and relentlessly fleeced. Ring up an agent for a two-bedroom accommodation prospect and you are told that the rent is, say, N800,000, but the “total package is N1.5 million.” The police are your friend and bail is free—until you actually need to get someone released on bail. This is a country in which aspiring football stars even have to pay certain corrupt coaches to get selected into a team. Nigerians know all of this and do not expect a change any time soon. In the power sector, plagued by protective institutions which act like captured regulators, Nigerians have paid for darkness for decades. And so even with its detailed monthly performance data which revealed the plight of consumers, the Nigerian Electricity Regulatory Commission (NERC) may well have been addressing aliens: very few people paid any attention, precisely because such horrendous disclosures had not earned power consumers any reprieve in the past.

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The gist is that during the period under review, the national power grid suffered total collapse, plunging customers into darkness, as the power generation companies (GenCos) reported a reduction in power generation due to low gas supply to power plants following unpaid debts. But the NERC report on monthly revenue performance and collection efficiency, which covered 11 DisCos, showed robust performance. The total revenue collected by all DisCos in 2025/Q3 was N570.25bn out of the N706.61bn that was billed to customers, which translates to a collection efficiency of 80.70 percent. With the total revenue collected by all DisCos in 2025/Q2 put at N564.71bn out of the N742.34bn billed to customers, power users paid N1.13tn to the DisCos as electricity bills for the six months in question.

That this is a terrible development is quite obvious. It raises an obvious question regarding what exactly Nigerians are paying for. Regular, adequate power supply is key to a lot of things, including industrialisation and the development of SMEs, but the authorities have never been able to actualise it. No matter what it has said or done, particularly since the return to civil rule in 1999, the Nigerian government has not got the power sector right. The problems are well known, from inadequate generation capacity, poor transmission infrastructure, distribution inefficiencies, corruption and mismanagement, to fuel supply issues for thermal plants. Potential solutions recommend themselves: diversify energy sources (solar, wind, hydro), upgrade transmission lines, improve billing and revenue collection, encourage private sector investment, increase fuel supply for thermal plants, and implement energy efficiency measures, but the typical Nigerian politician would tell you that it is easier said than done, even when Nigeria’s electricity sector has undergone significant reforms with the Electricity Act 2023, which allows states to generate, transmit, and distribute electricity within their territories. The decentralisation aims to increase electricity access, promote private sector investment, and improve power supply, but there is little evidence that the 36 states as a collective intend to take full advantage of it.

The key highlight of the electricity reform is that while the Nigerian Electricity Regulatory Commission (NERC) retains oversight of the national grid and interstate transmission, states can now regulate their electricity markets, issue licences, and set tariffs, and expand electricity access to unserved and underserved communities;  and that private investors can participate in electricity generation, transmission, and distribution. This should have spurred greater integration efforts than anyone has seen. Admittedly, some states are now leading the way: Enugu, Ekiti, Ondo, Lagos, Ogun, and Oyo have either established or taken steps to establish their own electricity regulatory commissions and begun operations. But the challenges ahead remain typical. Capacity gaps and funding constraints may hinder implementation, and coordination between federal and state regulators, which is crucial for success, is not always guaranteed. Yet, something has to be done, particularly in view of the fact that governance is problem-solving.

The government must protect electricity consumers. If Nigerians pay for power, they must get it. The current regime of bills with little or no power is unsustainable in the long run. It merely casts governance as a superstructure erected on people’s pains. Consumer protection isn’t just about pledges or lamentations; it is about decisive action. In the same vein, we call on the states to pursue joint power infrastructure efforts. There will be challenges, but they cannot be insurmountable.