Nigerian electricity distribution companies (DisCos) continued to face revenue shortfalls in December 2024, with a reported N60 billion in uncollected bills.
According to data contained in the fact sheet released by the Nigerian Electricity Regulatory Commission (NERC), the DisCos failed to collect approximately N60 billion in electricity bills in December 2024 from the total of N238.21 billion worth of electricity distributed to consumers during the month.
This significant revenue shortfall raises concerns about the financial health of the sector and its ability to provide reliable electricity to consumers.
The NERC fact sheet reveals that while DisCos’ billing was N238.21 billion in December, they only collected N177.96 billion, achieving a collection efficiency of 74.71 per cent. This left a gap of N60.25 billion uncollected.
READ ALSO: NERC Orders DisCos On 95% Electricity Offtake, Reviews KPIs
The data further highlights the varying performance of individual DisCos. Notably, several DisCos recorded collection efficiencies below the national average, indicating significant challenges in revenue collection.
“This level of revenue loss is unsustainable,” stated Aisha Mohammed, an energy analyst at the Lagos-based Centre for Development Studies.
“The DisCos need to significantly improve their collection efficiency to ensure the financial viability of the power sector.”
LEADERSHIP reports that the inability to collect billed revenue impacts the entire electricity value chain: it limits the DisCos’ ability to invest in infrastructure upgrades, maintain their networks, and pay for the electricity they purchase from generation companies (GenCos). This ultimately affects the quality and reliability of electricity supply to consumers.
According to the report, DisCos received a total of 2,705.86 GWh of energy in December, billing 2,257.83 GWh to customers, resulting in an overall billing efficiency of 83.44 percent. This represents a slight increase of 0.11 percent compared to November 2024, indicating a positive trend in DisCos’ ability to accurately meter and bill customers.
However, the revenue collection picture is less encouraging. Out of the total billing of N238.21 billion, DisCos only managed to collect N177.96 billion, resulting in a collection efficiency of 74.71 per cent. While this is an improvement of 5.88 per cent from the previous month, it still leaves a significant gap between billed and collected revenue.
The average allowed tariff for December was N116.18 per kWh, while the actual average collection was N82.50 per kWh, representing a recovery efficiency of 71.01 per cent. This means that DisCos are only recovering approximately 71 per cent of the revenue they are allowed to collect based on approved tariffs.
A closer look at the data reveals significant variations in performance among individual DisCos. Eko DisCo stands out with the highest billing efficiency of 89.03 per cent and collection efficiency of 91.50 per cent. Ikeja DisCo also demonstrated strong performance with a billing efficiency of 83.41 per cent and recovery efficiency of 80.71 per cent.
Conversely, some DisCos are struggling with revenue recovery. Kaduna DisCo, for example, had a recovery efficiency of only 31.87 per cent, while Aba DisCo’s recovery efficiency was 45.91 per cent. These low recovery rates suggest challenges in customer payment compliance and potential issues with metering and billing accuracy.
The NERC report also highlights the relative change in performance compared to November 2024. Notably, Yola DisCo recorded the biggest relative change in billing efficiency, with a 10.74 per cent increase.
The report also indicates that some DisCos experienced a decline in performance compared to the previous month.
