Lagos Moves to Criminalise Estimated Billing Amid 11,000MW Power Supply Deficit
Emmanuel Addeh in Abuja
The Lagos State Government has moved to criminalise the supply of electricity without meters, intensifying pressure on Distribution Companies (Discos), amid a widening power crisis that has left the state grappling with an estimated 11,000 megawatts supply deficit.
The move, backed by provisions in the Lagos Electricity Law and fresh regulatory reforms, seeks to outlaw arbitrary electricity charges for unmetered consumers, while compelling operators to accelerate meter deployment across the commercial hub.
These details were contained in the maiden 2025 Lagos Electricity Market Report released by the Lagos State Electricity Regulatory Commission (LSERC), which was seen by THISDAY yesterday.
The commission added that enforcement of compulsory metering would commence in 2026, stressing that universal smart metering across the state is expected to be implemented on a feeder-by-feeder basis.
“Adequate metering is fundamental to fair billing and consumer protection. The national metering rate across Nigeria’s Discos stood at 55.37 per cent as at September 2025…In the interim, the commission notes that non-metered consumers remain exposed to estimated billing, which has historically been a major source of consumer grievance and a significant impediment to accurate revenue collection.
“The commission draws attention to the provisions of section 89(2) of the law, which criminalises the supply of electricity without a meter, and notes that active enforcement of this provision will commence in 2026 in line with the SIP (Strategic Implementation Plan) metering timeline,” the report emphasised.
Besides, the document showed that while Lagos has an estimated electricity demand of about 12,000MW, average grid supply to the state remained below 1,000MW during the review period 2024/2025, leaving nearly 94 per cent of demand unmet.
Despite accounting for more than 30 per cent of Nigeria’s Gross Domestic Product (GDP), Lagos said it currently faces a massive electricity shortfall, a situation the state government said has compelled an aggressive push towards renewable energy investments and eventual cost-reflective tariffs.
The report noted that Lagos, Nigeria’s commercial hub with over 20 million residents, received an average allocation of only 930MW from the national grid in the third quarter of 2025, despite Nigeria’s installed generation capacity of 13,625MW. Actual average national generation dispatched during the same period stood at 5,430MW, highlighting deep inefficiencies across the wider power sector.
According to the report, the huge deficit has forced Lagos residents and businesses to rely heavily on self-generation through petrol and diesel generators, with the state estimated to host over 40 per cent of Nigeria’s informal off-grid generation capacity.
The commission stated that Nigeria currently operates between 22 million and 25 million small-scale generators, representing an estimated 10,000MW to 15,000MW of informal generation capacity nationwide.
As part of the transition, two distribution companies, Excel Electricity Distribution Limited and IE Energy Lagos Limited, it said, were licensed by LASERC in October 2025 as successor entities to the former Eko and Ikeja electricity distribution companies. Together, both firms currently serve about 1.55 million customers in Lagos.
“Eighteen other entities have submitted applications which are currently undergoing regulatory review, spanning distribution, embedded generation, off-grid, and captive power segments. An additional 27 operators previously licensed by NERC continue to operate within Lagos without having transitioned to the LASERC regulatory framework, representing a significant compliance and enforcement gap,” it stated.
However, the report revealed weak service delivery across the distribution segment. In Band ‘A’, where consumers are expected to receive a minimum of 20 hours of daily electricity supply, it said Excel achieved only 33.8 per cent compliance, while IE Energy recorded just 20 per cent compliance.
LASERC described the development as a major consumer protection concern, noting that many consumers were paying premium tariffs without receiving the corresponding level of service.
The report further showed that complaint resolution rates by the two utilities remained significantly below the commission’s 90 per cent benchmark. Between January and June 2025, the two Discos collectively resolved only 59.37 per cent of customer complaints received.
To close the supply gap, Lagos said it is now pursuing a long-term electricity strategy built around renewable energy, embedded generation, smart metering and off-grid solutions.
In addition, the report disclosed that Lagos plans to implement cost-reflective tariffs without direct government subsidies, while introducing a lifeline tariff for low-income consumers funded through cross-subsidisation.
