Nigeria’s electricity distribution companies (DisCos) failed to collect N669.49 billion from electricity bills issued to customers in 2025, raising fresh concerns over the financial health of the power sector.
The Nigerian Electricity Regulatory Commission (NERC), in its 2025 Annual Report, said the DisCos supplied electricity worth N3.68 trillion during the year but billed customers N2.99 trillion.
However, only N2.32 trillion of the amount billed was collected, leaving N669.49 billion unpaid.
NERC said this translated to a collection efficiency of 77.60 per cent.
“The total billing to electricity consumers by the DisCos was N2,988.30 billion, but only N2,318.81 billion was collected, translating to a collection efficiency of 77.60%,” the commission said.
The figures mean that the DisCos collected about N77.60 for every N100 they billed customers, leaving about N22.40 uncollected. The amount of unpaid bills also increased significantly compared with the previous year.
NERC said the DisCos left N536.95 billion uncollected in 2024. This rose to N669.49 billion in 2025, representing an increase of N132.54 billion, or 24.7 per cent, in one year.
The regulator’s report showed that the problem was not only about customers failing to pay their bills. A substantial amount of electricity supplied by the DisCos was not billed to customers in the first place.
According to NERC, the N3.68 trillion worth of electricity supplied during the year translated to a gross billing efficiency of 81.14 per cent. This means electricity worth about N694.80 billion was supplied but not billed.
The commission said the combination of poor billing and collection continued to put pressure on the finances of the Nigerian Electricity Supply Industry (NESI).
It said the inefficiencies were “weakening the financial liquidity” of the industry and limiting its ability to support new investments.
The financial difficulties also affected the DisCos’ payments to other participants in the electricity market.
NERC said the Nigerian Bulk Electricity Trading Plc (NBET) and the Market Operator issued gross invoices of N1.72 trillion to the DisCos in 2025 for energy costs and administrative services.
The DisCos paid N1.63 trillion, representing 94.80 per cent of their obligations, leaving a shortfall of N89.58 billion.
The regulator described the unpaid amount as an underpayment attributable to market participants.
The situation highlights one of the major problems confronting Nigeria’s power sector: generating and distributing electricity is only part of the challenge; collecting the money owed for the power supplied remains a major issue.
When DisCos fail to collect enough revenue, they have less money available to meet their financial obligations and invest in infrastructure.
This can affect their ability to maintain distribution networks, replace faulty equipment, expand their networks and improve electricity supply to consumers.
The latest figures also come against the background of continuing problems with metering and accurate billing. Many electricity customers remain unmetered, while disputes over estimated bills and complaints about inaccurate billing have remained common.
NERC has been pushing measures to improve metering, billing and revenue collection, while also strengthening consumer protection.
The commission has also taken regulatory action against DisCos over poor performance and non-compliance with its rules. In one recent case, NERC took over regulatory oversight of Kaduna Electricity Distribution Company after finding serious financial and operational weaknesses.
The regulator said Kaduna DisCo had a collection efficiency of only 46.69 per cent in 2025, while its billing efficiency stood at 61.56 per cent.
Across the wider sector, the latest annual figures show that the problem remains significant despite ongoing reforms.
The Electricity Act 2023 introduced changes aimed at improving competition, attracting investment and expanding electricity access, including allowing states and private investors to play a bigger role in the electricity market.
But NERC’s latest figures suggest that improving the financial performance of DisCos remains critical to achieving the broader goals of the reforms.
For consumers, the revenue problem has a direct connection to the quality of electricity services they receive. If DisCos cannot recover enough money from the electricity they supply, their capacity to invest in better infrastructure and provide more reliable service is weakened.
The N669.49 billion uncollected in 2025 therefore represents more than unpaid bills. It is money that could have helped strengthen the electricity distribution system and support investment across the sector.
NERC’s figures show that unless the industry can reduce billing gaps, improve metering and ensure that more customers pay for the electricity they consume, the financial problems affecting Nigeria’s power sector will remain difficult to resolve.
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