The Electricity distribution companies (Discos) in Nigeria recorded a sharp rise in revenue in 2025, despite weak operational performance across the power sector and highlighting deep structural challenges in Africa’s largest electricity market.
The data from the Nigerian Electricity Regulatory Commission (NERC) shows that total revenue collected by Discos climbed to N2.31 trillion in 2025, up from N1.7 trillion in 2024 and N1 trillion in 2023—an increase of over N600 billion year-on-year.
The surge reflects stronger collections driven in part by tariff adjustments under the ‘Band A’ framework, which prioritises higher-paying customers for improved supply hours. However, analysts say the revenue growth contrasts sharply with persistent inefficiencies in electricity generation and distribution.
The Discos issued electricity bills totaling N3.03 trillion in 2025 but recovered only N2.31 trillion, translating to a collection efficiency of 77.38%. This leaves a significant revenue shortfall of N684.41 billion, underlining ongoing liquidity constraints within the Nigerian Electricity Supply Industry (NESI).
The quarterly data indicates steady improvement in collections throughout the year, rising from N559.3 billion in Q1 to N621.2 billion in Q4, as enforcement and tariff structures strengthened.
Despite higher revenues, power generation metrics showed limited progress. NERC data indicates that average available generation capacity declined slightly to 5,400.38 megawatts in the fourth quarter of 2025, down from 5,430.34MW in the previous quarter.
More than half of Nigeria’s grid-connected plants reported reduced capacity, with key facilities such as Ibom Power, Geregu, Omotosho, Ihovbor and Afam facing operational constraints. Some assets, including Alaoji power plant, remained inactive.
Hydropower stations—including Kainji, Jebba and Zungeru—provided some relief, benefiting from seasonal water inflows, while thermal plants recorded marginal declines in output.
The sector’s average Plant Availability Factor (PAF) stood at just 39.64% in Q4, meaning over 60% of installed capacity was unavailable for dispatch—an indicator of ongoing technical and maintenance challenges.
Average hourly generation rose by 6.55% quarter-on-quarter to 4,452.71MWh/h, with total generation reaching 9,831.58GWh. The increase was largely driven by a 25.85% surge in hydropower output, offsetting weaker performance from thermal plants.
The divergence between rising revenues and weak operational metrics has intensified scrutiny of Nigeria’s electricity market, particularly around tariff structures and service delivery.
For consumers, electricity spending has more than doubled in two years, yet complaints over unreliable supply, estimated billing and infrastructure gaps remain widespread.
GIK/APA