Nigeria’s electricity supply challenges continue to worsen as Electricity Distribution Companies (DisCos) posted a combined financial loss of N2.349 trillion within two years, largely caused by billing leakages and weak revenue collection systems. The development has further aggravated the liquidity crisis affecting the Nigerian Electricity Supply Industry (NESI), leading to declining power generation and prolonged outages across the country.
The power sector, already weighed down by an estimated N6 trillion debt as of December 2025, is moving closer to a structural breakdown. Several thermal power plants are currently struggling to secure enough gas supply required to maintain steady electricity generation, a situation that threatens the stability of the national grid.
Persistent financial inefficiencies at the distribution level continue to erode the limited progress recorded in generation and transmission, making it difficult for the industry to maintain consistent power delivery to homes, offices, and businesses.
Commercial performance statistics released by the Nigerian Electricity Regulatory Commission (NERC) show that DisCos recorded losses of N1.015 trillion in 2024, while the figure increased by 31.4 percent in 2025, reaching N1.334 trillion. This brings the total loss for the two-year period to N2.349 trillion.
Further analysis of the 2025 data reveals that billing inefficiencies accounted for N649.87 billion, while poor revenue collection resulted in N684.28 billion loss.
Quarter-by-quarter figures also show irregular changes in the loss pattern during the year. DisCos recorded N378.11 billion loss in the first quarter of 2025, followed by N344.7 billion in the second quarter. The figure dropped by about 18 percent to N282.8 billion in the third quarter, before rising again by 16 percent to N328.54 billion in the fourth quarter.
Liquidity Crisis Worsens, Triggering Nationwide Blackouts
The growing financial pressure in the electricity sector is now clearly visible in the form of declining power supply nationwide, with many consumers experiencing longer and more frequent outages.
Average electricity generation on the national grid has dropped from about 4,600 megawatts in 2025 to below 3,500MW within the first two months of 2026, worsening the power shortage.
Industry figures indicate that Generation Companies (GenCos) are owed more than N6 trillion, forcing several plants to operate below installed capacity or shut down some units intermittently. Gas suppliers have also reduced deliveries due to unpaid invoices, further affecting electricity production.
As a result, rolling blackouts have returned in many parts of the country, with DisCos adopting load-shedding to manage the limited electricity available. In several states, daily supply has fallen below 12 hours, while some communities receive only four to six hours of power.
Residents in parts of Abuja, including Karu and Lokogoma, now receive only a few hours of electricity daily, forcing households and businesses to rely heavily on generators and alternative energy sources.
Other states under the Abuja Electricity Distribution Company (AEDC), such as Nasarawa, Niger, and Kogi, have also experienced extended outages.
In Delta State, within the Benin Electricity Distribution Company (BEDC) network, electricity supply remains unstable, with many communities receiving less than three hours of power daily.
Residents in Ughelli, Warri, Sapele, Oleh, and nearby towns report persistent blackouts despite high estimated bills, with some communities staying in darkness for days without official explanation from the distribution company.
Public frustration continues to grow as many consumers describe the current situation as unbearable.
Presidential Villa Moves Off National Grid
In a move that highlights the seriousness of Nigeria’s electricity problems, the Presidential Villa in Abuja has begun steps to disconnect from the national grid after completing a solar mini-grid project.
The project, valued at about N17 billion, involves installing a dedicated solar hybrid power system designed to provide uninterrupted electricity to the seat of government.
Officials explained that the decision was taken to guarantee energy security and reduce dependence on the unstable national grid.
However, the Acting Managing Director of AEDC, Engr. Chijoke Okwuokenye, disagreed with the decision, saying it was not because the company could not supply electricity.
According to him, the Villa had long relied on generators to avoid the risk of power interruption, and the arrangement continued over the years.
He stated that with additional investment in storage and network upgrades, uninterrupted electricity could have been achieved without leaving the grid.
He added that modern technology makes it possible to provide reliable power at a cost lower than diesel generation, and that DisCos are capable of delivering premium hybrid solutions that guarantee constant supply.
He also noted that the continued use of generators by government agencies suggests that other interests may be influencing such decisions.
Consumers Accuse DisCos of Exploitation
Chairman of the Electricity Consumers Association of Nigeria, Chijoke James, accused distribution companies of exploiting customers through estimated billing.
He said estimated billing remains one of the most unfair practices in the Nigerian power sector, as consumers are often charged for electricity they never received.
According to him, excessive bills are one of the main reasons many customers refuse to pay.
He also alleged that some staff members take advantage of the situation by demanding unofficial payments from consumers under the threat of disconnection without remitting the money to the company.
He added that the sight of officials carrying ladders now creates suspicion among residents, who often believe the visit is meant for extortion rather than service delivery.
Experts Blame Metering Gaps as Government Responds
Power sector consultant and legal practitioner Bode Fadipe linked many of the sector’s inefficiencies to the lack of proper metering and poor transparency.
He explained that without accurate meters, electricity consumption cannot be correctly measured, which leads to estimated billing.
According to him, any billing method based on assumptions will always create disputes between consumers and distribution companies.
He stressed that electricity can be measured at every stage of the value chain, from generation to transmission and distribution, and that proper metering is the only reliable solution.
He also expressed concern that the Federal Government has not shown enough political commitment to fully resolve the financial crisis in the sector.
He noted that some operators believe the government will always step in with bailout funds whenever the industry faces difficulties, which discourages long-term reforms.
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