DisCos Rake In N603bn Despite 3.4% Drop In Power Offtake

Electricity distribution companies (DisCos) collected N603.64 billion from customers in the second quarter of 2026 despite a 3.4 per cent decline in the volume of power they received from the electricity market.

The figure was contained in the Nigerian Electricity Regulatory Commission’s (NERC) second-quarter 2026 report, which showed that average energy offtake by the 11 DisCos fell during the period.

The companies received an average of 3,197.03 megawatt-hours per hour (MWh/h) at their trading points in the second quarter, down from 3,309.48MWh/h in the first quarter.

The 112.45MWh/h decline represented a 3.40 per cent drop in average offtake. Despite this, the DisCos achieved an overall offtake performance of 94.07 per cent against available partially contracted capacity of 3,398.41MWh/h.

NERC reported that the DisCos received 6,982.32 gigawatt-hours (GWh) of electricity during the quarter but billed customers for only 5,812.31GWh.

The commission put their overall energy accounting efficiency at 83.24 per cent, a marginal decline from the 83.48 per cent recorded in the first quarter.

The value of electricity off-taken by the DisCos stood at N946.57 billion, while the total value of energy billed to customers was N744.67 billion.

That translated to a billing efficiency of 78.67 per cent, down by 0.57 percentage points from the 79.24 per cent recorded in the preceding quarter.

However, the companies improved their collection performance during the period, recovering N603.64 billion from the N744.67 billion billed to customers.

NERC said the collection efficiency stood at 81.06 per cent, representing an improvement of 2.11 percentage points over the 78.95 per cent recorded in the first quarter.

Despite the improvement, the DisCos left N141.03 billion of billed electricity revenue uncollected during the quarter.

The report also showed that the power distribution sector continued to face substantial technical, commercial and collection losses.

The weighted average Aggregate Technical, Commercial and Collection (ATC&C) losses across the 11 DisCos stood at 36.23 per cent in the second quarter.

Although the figure improved from 37.44 per cent in the first quarter, it remained significantly above the 16.92 per cent target set under the 2026 Multi-Year Tariff Order (MYTO).

“The ATC&C loss of 36.23 per cent is 19.31pp higher than the 2026 MYTO target (16.92 per cent) and translates to a cumulative revenue loss of N129.07 billion across all DisCos,” NERC stated.

None of the 11 DisCos met their ATC&C targets during the quarter, with Kaduna Electricity Distribution Company recording the widest gap between its actual performance and its regulatory target.

Kaduna DisCo recorded an actual ATC&C loss of 67.70 per cent against a target of 18.18 per cent.

The commission also disclosed that the DisCos’ cumulative upstream invoice payable to the electricity market stood at N410.38 billion during the quarter.

Of the amount, N326.46 billion represented generation costs payable to the Nigerian Bulk Electricity Trading Company (NBET), while N83.92 billion covered transmission and administrative services provided by the market operator.

The DisCos collectively paid N385.44 billion, comprising N306.62 billion to NBET and N78.82 billion to the market operator.

This left an outstanding balance of N24.94 billion and translated to a market remittance performance of 93.92 per cent.

The performance was slightly below the 94.08 per cent recorded in the first quarter.

Meanwhile, the Federal Government continued to bear a significant portion of electricity generation costs through subsidies linked to the tariff regime.

NERC said the government covered about 50 per cent, amounting to N321.26 billion, of the total generation costs during the quarter.

The subsidy arose from the decision to freeze end-user electricity tariffs at the rates applicable in July 2024.

The report also revealed a wide gap in payment performance between international and domestic bilateral electricity customers.

Three international bilateral customers buying electricity from grid-connected generating companies paid $8.67 million against an $18.84 million invoice issued by the market operator.

Their remittance rate stood at 46.02 per cent.

Domestic bilateral customers recorded a stronger performance, paying N6.91 billion from an invoice of N7.55 billion.

That represented a remittance rate of 91.54 per cent during the quarter.

The figures indicate that while the DisCos improved their ability to collect revenue from customers in the second quarter, the sector continued to contend with lower power offtake, high ATC&C losses and unpaid electricity bills.