Despite Poor Power Supply, Discos’ Revenue Rise 92% in Q1

Rake in N560bn in 2025 compared to N291.6bn in 2024

FG says sector still illiquid, may approve further hike 

Emmanuel Addeh in Abuja 

Revenues accruing to electricity Distribution Companies (Discos) in Nigeria rose by 92 per cent in the first quarter of 2025, compared to the same period of last year, a THISDAY analysis of data from the Nigerian Electricity Regulatory Commission (NERC) has shown.

Whereas in Q1 of 2024, the 12 power distribution firms in the country generated a revenue of N291 billion, however, in Q1 of 2025, the companies raked in a whopping N560 billion, mainly attributable to the increase in tariffs paid by ‘Band A’ customers as well as efforts to raise the penetration of meters nationwide.

The Discos include: Abuja, Benin, Eko, Enugu, Ibadan, Ikeja, Jos, Kaduna, Kano, Port Harcourt, Yola and recently Aba distribution company.
In all, in January this year, the Discos generated N178.68 billion; got N191.75 billion in February and collected N188.89 billion in March this year, to hit about N560 billion, according to the NERC data.

However, despite the additional N268.38 billion revenue increase in Q1, 2025, compared to Q1 last year, the Discos recorded roughly N202 billion, put side by side total amount billed as revenue collection deficit in the first three months of this year.

According to the data, they were able to realise about N560 billion out of a total of N761.91 billion billed to customers during the period, compared to the N291.6 billion collection out of the N368.65 billion billed to customers in Q1, 2024.

In April 2024, the federal government  through NERC approved a 230 per cent tariff hike for Band ‘A’ customers, classifying them as those receiving at least 20 hours of electricity daily. The tariff rose from around N66/kWh to roughly N225/kWh, later averaging about N209.

At the time, the federal government said it aimed to reduce subsidy burden, stating that the cost-reflective tariff will help improve cash flow for Discos and enhance potential investment in infrastructure.

The government claimed that the hike was essential to achieving sustainable revenue in the power sector, given that existing tariffs only covered about 65 per cent of actual costs .

However, the hike was criticised as insensitive, given the frequent and erratic supply, even for Band A users. Although the government has said that where Discos don’t meet the 20‑hour daily supply, feeders should be downgraded or customers compensated, achieving this has still problematic for the Discos.

But in all, a breakdown showed that in January this year, out of a total billing of N250.21 billion, the Discos realised N178.68 billion; in February, the power distributors billed N245.93 billion and realised N191.75 billion, while in March N265.77 billion was billed to customers, but N188.89 billion was collected.

Put against the data for the same period in 2024, in January, the Discos collected N95.26 billion out of N130.83 billion; N97.01 billion out of N113.05 billion in February and N99.33 billion collection out of N124.66 billion.

But despite the massive revenue improvement,  the Minister of Power, Adebayo Adelabu, has recently signaled a fresh round of electricity tariff adjustments, targeting Bands ‘B’ and ‘C’ to align them more closely with the Band ‘A’ rate, currently around N209 per kilowatt-hour. 

Adelabu argued that existing subsidies, estimated at over N4 trillion, both legacy debts and  subsidy arrears, owed to Generation Companies (Gencos) have become unsustainable.

Adelabu, however, said that while the government plans to phase out blanket subsidies, it intends to maintain targeted support for vulnerable groups, with the ultimate aim being to establish a cost-reflective tariff regime, ensuring customers pay rates that accurately reflect service costs and encourage distribution companies to invest in infrastructure .

This proposal has sparked widespread concerns, as consumer groups, small business associations, and opposition voices describe the timing as “insensitive,” arguing that higher tariffs could further burden Nigerians—especially given ongoing issues like erratic power supply, inadequate metering, and grid instability.