Discos’ Revenue Soars 40% Y-o-Y in April as Monthly Billing Hits N257.5bn

Emmanuel Addeh in Abuja 

As the federal government continues to signal additional tariff increase for Nigeria’s electricity users, Distribution Companies (Discos) again posted a sharp 40 per cent year-on-year revenue increase in April 2025, amid a  total billing of N257.57 billion for the month.

The commercial performance data just released by the Nigerian Electricity Regulatory Commission (NERC), indicated that for the month under consideration, the electricity utility companies raked in N199.85 billion, a record in recent times.

The development coming exactly a year after the so-called Band ‘A’ tariff regime was introduced, signalled the growing impact of the hikes and improvements in collection mechanisms, even as the actual volume of electricity delivered for that month dipped.

However, according to the NERC data, despite the record sum collected, it translated to a collection efficiency of 77.6 per cent, an improvement on March’s 71.1 per cent collection rate, still falling short of the funding needed to ensure full liquidity and sustainability in the Nigerian Electricity Supply Industry (NESI).

Crucially, the impressive rise in billing occurred, despite the total energy received by the Discos dropping to 2,622.46 gigawatt-hours (GWh), a 9.2 per cent decrease from the previous month. 

Of this, the volume of electricity billed to customers stood at 2,184.61 GWh, a decline of 5.8 per cent, signalling that that the revenue jump was not driven by improved energy delivery, but largely by higher end-user tariffs, especially for Band ‘A’ customers, who are billed what has been described as cost-reflective rates of approximately N209 per kilowatt-hour, following the April 2024 adjustment from the previous N66/kWh.

The tariff reform, which which more than tripled the cost of power for Band A customers, was intended to reflect the true cost of service and reduce the federal government’s subsidy burden. It also aimed to boost cash flows to Discos and Generation Companies (Gencos) while attracting investor confidence in the sector. 

Although so far, it has succeeded in increasing revenues on paper, but whether this translates into improved power delivery remains a contentious issue.

Earlier, THISDAY reported that in the first quarter of 2025, total billing in the power sector hit N744.27 billion, with N553.63 billion collected, resulting in a quarterly collection efficiency of 74.4 per cent, down from 77.4 percent recorded in Q4 2024. 

Over the same four-month period ending in April, the billing figure rose to about N1.02 trillion, but under-recovery hit N260 billion, reflecting persistent payment challenges among consumers, growing energy poverty, and uneven service delivery.

One of the most pressing concerns remains the Aggregate Technical, Commercial, and Collection (ATC&C) losses, which stood at an average of 39.6 per cent in Q1 2025. This is nearly double the 20.5 per cent target set under the Multi-Year Tariff Order (MYTO), resulting in estimated revenue losses of N200.5 billion. 

For the month under review, Eko Disco collected 100 per cent of its revenue, which hit N38.7 billion, rising by 28.82 per cent; Ikeja collected N34.68 billion, with a revenue rise of 6.1 per cent while While Abuja Disco got N30.27 billion, a 4.3 per cent dip.

While improved metering and digital billing have contributed to better revenue collection in more urbanised service areas, the deep infrastructural deficit, especially in rural areas, has continued to frustrate efficient service. Many customers remain unmetered, leading to widespread disputes over estimated billing and perceptions of unfair pricing.

For Band A customers, who are supposed to enjoy a minimum of 20 hours of electricity daily, sometimes the reality falls short. Many feeders under the Band A classification have failed to deliver the expected supply duration, even as their tariffs have increased significantly. 

In response, the power sector regulator has stated that such feeders are downgraded or the customers placed on them receive financial rebates. 

According to the NERC factsheet, the average allowed tariff across Discos during the month under consideration was N116.25/kWh, while the actual average collection stood at N90.55/kWh and recovery efficiency stood at N77.90 per cent.

In April last year when the band A tariff was launched, Discos’ collection rose considerably to N142.92 billion, as against the previous month of March, when total revenue by the Discos was N100.44 billion.

The power industry regulator had said that the Band ‘A’ customers which accounted for about 15 per cent of the 12 million electricity consumers in the nation at the time, that is about 2 million Nigerians, were impacted by the increase in price that Nigerians pay per kilowatt.

It stated that 800 feeders were categorised as Band A at the time, stressing that upon review of the feeders’ performance, the commission had reduced it to under 500.

”The overarching objective of the commission in the consideration of the tariff application is the creation of a financially sustainable electricity market providing adequate and reliable power supply to drive the Nigerian economy,” Vice Chairman of NERC, Mr. Musliu Oseni, said when the programme was launched in Abuja last year.