Discos Bill Nigerians N496.14bn in Two Months, Record 25% Collection Deficit

Emmanuel Addeh in Abuja 

The electricity Distribution Companies (Discos) operating in Nigeria sent a bill worth N496.14 billion of total power consumed to Nigerians in January and February this year, but were only able to recover N370.43 billion, representing 75 per cent of the total amount invoiced.

Data released by the Nigerian Electricity Regulatory Commission (NERC) analysed by THISDAY showed that for the two months under consideration, the power distributors recorded a deficit collection of N125.71 billion or roughly 25 per cent of total amount charged customers.

Although there has been an improvement recently, for years Nigeria’s electricity revenue collection challenge has been rooted in systemic inefficiencies, weak collection infrastructure, and a lack of consumer confidence.

Aside from power theft, one of the major issues in the sector, is the low collection rate by electricity distribution companies, which often struggle to recover payments for electricity consumed. This problem is exacerbated by inadequate metering, leading to widespread use of estimated billing that many consumers view as unfair or inflated. 

As a result, many customers either underpay, delay payment, or refuse to pay altogether, citing distrust in the billing process. These further lead to a ripple effect that undermines power supply reliability and discourages further investment in infrastructure and a vicious cycle of poor service delivery, customer dissatisfaction, and illiquidity.

However, the two-month data indicated that while in January, total billing by the 12 Discos was N250.21 billion, the amount collected was N178.68 billion, whereas in February, the electricity distributors billed a total amount of N245.93 billion, but got a revenue of N191.75 billion.

Besides, the Discos received 2,793.42Gwh of power, with total billed being 2,260.34Gwh in January, with billing efficiency in terms of electricity received being 80.92 per cent, compared to the 2,583.19Gwh received in February and 2,137.00Gwh total energy billed during the month.

Eko Disco led the pack with the highest actual collection for both months, which was N72.61 billion, divided into N36.01 billion in January and N36.60 billion in February respectively, followed by Ikeja Disco, with actual collection of N32.81 billion and N33.35 billion in January and February respectively, to hit a N66.16 billion target for the two months.

They were followed by Abuja Disco, which received N24.82 billion in the first month of the year and N31.76 billion in the second month of this year, with cumulative revenue for both months being N56.58 billion.

Conversely, in January, Kaduna Disco had the least collection efficiency of 39 per cent, getting a paltry N3.06 billion for the entire month, but improved in February to 64 per cent, collecting N4.5 billion during the month, to total N7.56 billion during the period under consideration.

Another seemingly underperforming Disco during both months was Yola Disco, which collected N2.34 billion in January and N2.89 billion in February, with its total revenue for the period being N5.28 billion.

The opposing takes on liquidity in the power sector by the electricity customers and the operators has been interesting.  On one side, many Nigerians argue they are paying too much for electricity, often pointing to high monthly bills despite irregular or poor power supply. 

Their major complaint stems from estimated billing, where many unmetered customers receive inflated charges not based on actual usage. Even those with prepaid meters sometimes feel costs are high relative to the unreliable service they receive. On the other side, the federal government insists that consumers are not paying enough to cover the real cost of generating, transmitting, and distributing electricity. It argues that low, state-regulated tariffs and massive subsidies have created a financially unsustainable system.

This has led to over N4 trillion in debt owed to generation companies, discouraging investment and limiting infrastructure upgrades. According to the government, without cost-reflective tariffs, the sector cannot improve reliability or expand access.

The Minister of Power, Adebayo Adelabu, has always strongly advocated for the implementation of cost-reflective electricity tariffs in the sector as a necessary step to ensure its financial viability.

He argues that the long-standing system of government subsidies on electricity are no longer sustainable, urging Nigerians to brace up for higher tariffs.