DisCos’ Monthly Revenue Falls 4.9% to N182.11bn

Nigeria’s electricity distribution companies (DisCos) recorded a 4.9 per cent decline in their monthly revenue, which dropped to N182.11 billion, according to the latest industry data. The decline highlights ongoing challenges within the power sector despite recent tariff reviews and efforts to improve collections.

Figures from the Nigerian Electricity Regulatory Commission (NERC) indicate that the revenue shortfall was driven by a combination of factors including lower energy offtake by some customers, persistent metering gaps, and rising incidences of electricity theft. Industry sources also attribute the dip to the lingering economic difficulties affecting household and industrial consumers, leading to reduced capacity to settle energy bills promptly.

The NERC report further showed that the DisCos collectively billed customers significantly higher than the actual collections recorded during the review period, underscoring a sustained mismatch between energy consumption and payments. Experts warn that this revenue performance could affect the liquidity of the entire electricity value chain, including generation and transmission companies.

The report also highlights that while the service-based tariff regime has improved cost-reflectiveness in certain customer bands, its benefits are yet to translate fully into improved financial sustainability for the DisCos. Some operators have continued to struggle with high aggregate technical, commercial, and collection (ATC&C) losses despite regulatory interventions and metering initiatives aimed at improving revenue assurance.

Analysts note that the decline in DisCos’ revenue comes at a time when Nigeria’s power sector is facing calls for massive investment in infrastructure to improve reliability and expand access. The revenue shortfall could further complicate the ability of the distribution companies to fund network upgrades, procure meters, and settle obligations to other market participants.

Industry operators also stress that the persistent liquidity crisis in the sector has been exacerbated by gas supply constraints to power plants, grid instability, and lack of cost-reflective tariffs for all customer classes. They emphasize that without comprehensive reforms, the sector’s financial challenges may worsen despite ongoing government interventions.

Meanwhile, stakeholders have reiterated the need for more innovative solutions to improve collections and curb losses. These include deploying advanced metering infrastructure, enhancing customer engagement to reduce resistance to tariff changes, and improving the transparency of billing practices to build trust among consumers.

Market watchers argue that the government’s ongoing reforms, including the recent unbundling of the power sector and state-level regulation of electricity, could offer a long-term pathway for improved revenue performance. However, they caution that the gains from these initiatives may take time to materialize unless backed by consistent policy execution and private sector participation.

The drop in revenue has also sparked discussions around the impact of electricity tariffs on households and businesses, with consumer advocacy groups warning that frequent tariff increases without corresponding improvements in supply will continue to hurt collections. They urge both the DisCos and the regulator to focus on service delivery to justify tariff adjustments.

As the electricity market transitions to a more decentralized structure with sub-national regulation, experts believe that competition and performance benchmarking among DisCos could drive efficiency. Improved collections and financial viability are viewed as critical to attracting investments that will ultimately improve supply and service quality for Nigerians.

With power being a critical enabler of economic growth, stakeholders agree that resolving the revenue challenges of DisCos remains essential for the sector’s sustainability. The government and industry operators are expected to continue exploring solutions that balance cost recovery for investors with affordability for consumers to ensure a more stable electricity market.