Precious Anga
Lagos — Nigeria’s electricity sector recorded weaker operational and commercial performance in the first quarter of 2026, with power generation declining by 9.64 per cent and electricity distribution companies (DisCos) losing an estimated ₦140.64 billion to technical, commercial and collection inefficiencies, according to the latest report by the Nigerian Electricity Regulatory Commission (NERC).
The report showed that average available generation capacity from the country’s grid-connected power plants fell to 4,457.96 megawatts (MW) during the quarter, down by 942.42MW, or 17.45 per cent, from 5,400.38MW recorded in the fourth quarter of 2025.
NERC attributed the decline to reduced available capacity across 20 of the 28 grid-connected power plants operating during the review period, resulting in lower electricity output across the national grid.
Average hourly electricity generation also declined to 4,112.72 megawatt-hours per hour (MWh/h) from 4,452.71MWh/h in the preceding quarter, while total energy generated dropped to 8,883.47 gigawatt-hours (GWh) from 9,831.58GWh, representing a decline of 948.10GWh.
Electricity supplied to the distribution companies also weakened during the period. Average energy offtake at Disco trading points fell by 8.56 per cent to 3,309.48MWh/h, compared with 3,619.21MWh/h recorded in the final quarter of 2025.
Despite the decline, the distribution companies achieved an energy offtake performance of 97.11 per cent against the available Partially Contracted Capacity of 3,408.02MWh/h, indicating that most of the electricity available for distribution was successfully taken up.
The report, however, showed only marginal improvement in energy accounting. Of the 7,148.47GWh received by the DisCos, 5,967.22GWh was billed to customers, translating to an energy accounting efficiency of 83.48 per cent, slightly higher than the 82.94 per cent recorded in the previous quarter.
Financial performance remained under pressure despite the modest operational improvement.
According to NERC, electricity worth ₦955.19 billion was supplied during the quarter, but only ₦756.93 billion was billed to customers, resulting in a billing efficiency of 79.24 per cent, down from 82.03 per cent in the fourth quarter of 2025.
The shortfall created cumulative billing losses estimated at ₦198.25 billion.
Revenue collection also weakened slightly, with the DisCos recovering ₦597.56 billion out of the total amount billed, representing a collection efficiency of 78.95 per cent, compared with 79.36 per cent in the previous quarter.
NERC identified Aggregate Technical, Commercial and Collection (ATC&C) losses as one of the sector’s biggest challenges during the period.
The commission reported that the weighted average ATC&C loss across all DisCos rose to 37.44 per cent, significantly above the regulatory benchmark of 16.92 per cent and higher than the 34.90 per cent recorded in the preceding quarter.
According to the regulator, the losses comprised 20.76 per cent technical and commercial losses and 21.05 per cent collection losses, resulting in an estimated ₦140.64 billion revenue loss across the electricity distribution companies.
NERC disclosed that none of the eleven DisCos met their approved ATC&C performance targets during the quarter, highlighting the persistent operational and commercial inefficiencies affecting the distribution segment.
Kaduna Electric recorded the weakest performance, posting an actual ATC&C loss of 69.66 per cent against its regulatory target of 18.18 per cent, making it the poorest-performing utility in the first quarter of the year.
The commission said the continued failure of the distribution companies to meet loss reduction targets underscores the urgent need for stronger investments in network infrastructure, improved metering, enhanced revenue collection systems and operational reforms to improve the financial sustainability of Nigeria’s electricity market.
