Nigeria’s electricity distribution companies (DisCos) failed to collect N669.49 billion from electricity bills issued to customers in 2025, raising fresh concerns about the financial health of the country’s 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 DisCos collected about N77.60 for every N100 billed to customers, leaving approximately N22.40 uncollected.
The amount of unpaid electricity bills also increased significantly compared with the previous year.
NERC said DisCos left N536.95 billion uncollected in 2024. The figure rose to N669.49 billion in 2025, representing an increase of N132.54 billion, or 24.7 per cent, within one year.
The regulator’s report showed that the challenge was not limited to customers failing to pay their electricity bills. A substantial amount of electricity supplied by DisCos was not billed to customers in the first place.
According to NERC, the N3.68 trillion worth of electricity supplied in 2025 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.
It said the inefficiencies were weakening the financial liquidity of the industry and limiting its ability to support new investments.
The financial challenges also affected the ability of DisCos to meet their obligations to other participants in the electricity market.
NERC said the Nigerian Bulk Electricity Trading Plc and the Market Operator issued gross invoices of N1.72 trillion to 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 latest figures highlight one of the major challenges confronting Nigeria’s power sector, as generating and distributing electricity is only part of the problem. Ensuring that electricity supplied is properly billed and paid for remains a major challenge.
When DisCos fail to collect sufficient revenue, they have less money available to meet their financial obligations and invest in infrastructure.
This could affect their ability to maintain distribution networks, replace faulty equipment, expand their networks and improve electricity supply to consumers.
The figures also come amid continuing concerns over metering and accurate billing. Many electricity customers remain unmetered, while disputes over estimated bills and complaints about inaccurate billing continue across the country.
NERC has introduced measures aimed at improving metering, billing and revenue collection while strengthening consumer protection and regulatory compliance.
The commission has also taken 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 identifying serious financial and operational weaknesses.
The regulator said Kaduna DisCo recorded a collection efficiency of only 46.69 per cent in 2025, while its billing efficiency stood at 61.56 per cent.
Across the wider electricity sector, the latest annual figures show that the financial challenges remain significant despite ongoing reforms.
The Electricity Act 2023 introduced changes aimed at improving competition, attracting investment and expanding access to electricity, including allowing states and private investors to play a bigger role in the electricity market.
However, 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 could be weakened.
The N669.49 billion uncollected in 2025 therefore represents more than unpaid electricity bills. It is revenue that could have supported investment and helped strengthen Nigeria’s electricity distribution system.
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 may remain difficult to resolve.
