Nigeria’s electricity distribution companies generated over N2.3tn in revenue in 2025, even as households and businesses continued to grapple with persistent power outages, estimated billing, and inconsistent electricity supply across the country.
Latest industry data shows that the 12 electricity distribution companies operating in the Nigerian Electricity Supply Industry collectively earned about N2.325tn from electricity consumers last year, highlighting a sharp rise in collections despite growing public dissatisfaction with service delivery.
The figure represents a notable 29 per cent increase from the approximately N1.8tn recorded in 2024, suggesting stronger billing enforcement and higher electricity tariffs under the ongoing reforms in Nigeria’s power sector.
The development has once again reignited debate among stakeholders over the relationship between rising electricity tariffs and the quality of service delivered to consumers.
DisCos Revenue Rises Despite Erratic Power Supply
The surge in DisCos revenue despite erratic power supply reflects a complex mix of tariff adjustments, improved billing systems, and increased collection efficiency by electricity distribution companies.
Data obtained from the Nigerian Electricity Regulatory Commission’s monthly market reports showed that electricity distribution companies generated N553.63bn in revenue during the first quarter of 2025.
Collections increased further in the second quarter to about N564.71bn, indicating a gradual improvement in billing enforcement and revenue recovery across the sector.
The second half of the year also witnessed sustained high collections.
In July 2025, the distribution companies recorded total revenue of N193.96bn, which dipped slightly in August to N191.11bn, representing a marginal decline of about 1.5 per cent.
However, the downward trend proved temporary.
Revenue collections rebounded in September, rising to N196.26bn, before climbing further in October to N210bn, marking one of the strongest monthly performances during the year.
Although collections dipped slightly towards the end of the year, the figures remained significantly high.
Revenue fell marginally to N208.78bn in November and further to N207bn in December, reflecting minor declines compared to earlier months.
Overall, monthly payments by electricity consumers remained largely between N190bn and N210bn throughout the second half of 2025.
Collection Efficiency Improves Across Distribution Companies
Regulatory data also revealed a gradual improvement in collection efficiency across several electricity distribution companies.
According to the commission’s factsheet, collection efficiency rose to 80.22 per cent in December, compared to 77.49 per cent in November, suggesting improved recovery of billed electricity revenue.
Among the distribution companies, Eko Electricity Distribution Company recorded the strongest revenue recovery performance, achieving 99.45 per cent recovery of allowed revenues.
Other companies that recorded relatively strong performance included Yola Distribution Company with 87.89 per cent, Ikeja Electric with 85.32 per cent, and Abuja Electricity Distribution Company with 84.43 per cent recovery efficiency.
Moderate recovery levels were recorded by Benin (71.36 per cent), Ibadan (73.19 per cent), Enugu (73.50 per cent), and Port Harcourt (79.29 per cent) distribution companies.
Industry analysts say these metrics provide insights into how effectively distribution companies are billing customers, collecting payments, and recovering revenue, all of which are key indicators of financial sustainability within the power sector.
Consumers Still Complain About Poor Service
Despite the rise in DisCos revenue despite erratic power supply, consumers across the country continue to complain about unreliable electricity supply and billing practices.
Many households and small businesses report experiencing frequent feeder outages, long hours of blackout, and disputes over estimated billing, particularly in areas where prepaid meters are yet to be installed.
Consumer advocacy groups have repeatedly accused electricity distribution companies of prioritising revenue generation over network upgrades and infrastructure investments.
These groups argue that rising tariffs should correspond with improved service delivery, including stable power supply and expanded metering coverage.
Structural Challenges Continue to Weigh on Power Sector
Nigeria’s electricity sector has struggled with structural challenges for over a decade, despite the privatisation of power assets in 2013, when private investors acquired the generation and distribution companies.
Industry experts say the sector continues to battle infrastructure deficits, high technical losses, weak transmission capacity, and limited metering coverage, which have collectively slowed progress in improving electricity supply.
Electricity generation in Nigeria typically fluctuates between 3,000 megawatts and 5,000 megawatts, far below the country’s estimated demand of over 20,000 megawatts.
Frequent national grid disturbances, gas supply constraints to power plants, and ageing transmission infrastructure have also contributed to the sector’s operational difficulties.
Tariff Reforms Drive Revenue Growth
Energy analysts attribute the increase in DisCos revenue despite erratic power supply partly to tariff reforms implemented in recent years.
The Federal Government introduced cost-reflective electricity tariffs for certain categories of consumers, particularly high-consumption urban users, in an effort to improve liquidity across the power value chain.
These reforms were designed to address long-standing revenue shortfalls that have affected investments in generation, transmission, and distribution infrastructure.
However, critics argue that while tariffs have increased, service delivery has not improved at the same pace, leaving many consumers frustrated.
Experts maintain that revenue growth alone will not resolve Nigeria’s electricity challenges unless improvements occur simultaneously across power generation, transmission capacity, and distribution infrastructure.
Until these structural issues are addressed, stakeholders warn that rising electricity payments may continue to place greater financial pressure on households and businesses without delivering the stable power supply needed to drive economic growth.
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