Nigeria is grappling with mounting unpaid electricity bill from neighbouring West African countries, raising fresh concerns about revenue leakages, power sector sustainability, and the long-term viability of regional electricity trade.
Latest figures released by the Nigerian Electricity Regulatory Commission (NERC) show that international electricity customers, particularly Togo, Niger, and Benin, have accumulated significant outstanding debts for power supplied through bilateral arrangements.
The disclosure comes at a time when Nigeria’s power sector is under intense pressure from domestic funding gaps, liquidity constraints, and rising operational costs.
While electricity export remains a strategic tool for regional integration and diplomacy, regulators and industry stakeholders are increasingly questioning whether the current structure adequately protects Nigeria’s financial interests.
Togo, Niger, Benin owe Nigeria N25bn for electricity bill
According to NERC’s Third Quarter 2025 report, Togo, Niger, and Benin collectively owe Nigeria $17.8 million for electricity supplied through cross-border bilateral agreements.
At the prevailing exchange rate of approximately N1,425 to the dollar, the outstanding amount translates to about N25.36 billion.
The regulator disclosed that the three countries were invoiced a total of $18.69 million for electricity supplied during the third quarter of 2025.
However, payments received during the period amounted to only $7.125 million, leaving an unpaid balance of $11.56 million for the quarter alone.
In addition to the Q3 shortfall, NERC reported that the international customers carried legacy debts from previous quarters. Of the $14.7 million billed from earlier periods, only $7.84 million was settled, leaving a balance of $6.23 million.
Combined, the historical and current obligations brought the total debt to $17.8 million.
The international offtakers identified in the report are Compagnie Énergie Électrique du Togo, Société Béninoise d’Énergie Électrique (SBEE) of Benin, and Société Nigérienne d’Électricité (NIGELEC) of Niger.
Weak Remittance Performance Raises Regulatory Concerns
NERC’s report revealed that the three international customers recorded a remittance performance of just 38.09 per cent for the third quarter of 2025.
This means that more than half of the electricity invoices issued during the period remained unpaid at the end of the quarter.
The commission noted that the power supplied to the neighbouring countries was generated by grid-connected Nigerian generation companies (GenCos) and transmitted through established cross-border bilateral power arrangements.
These exports are part of Nigeria’s commitment to regional energy cooperation within West Africa.
However, the poor remittance performance has raised concerns within the electricity market, particularly as Nigerian GenCos and other market participants continue to face delayed payments, foreign exchange exposure, and rising production costs.
Industry analysts warn that persistent non-payment by international customers could weaken confidence in cross-border electricity trade and worsen liquidity challenges across the Nigerian Electricity Supply Industry (NESI).
Domestic Bilateral Customers Perform Better
In contrast to the weak payment record of international customers, NERC disclosed that domestic bilateral customers showed stronger financial discipline during the same period.
According to the report, domestic bilateral customers were invoiced N3.64 billion in Q3 2025 and remitted N3.19 billion, representing a remittance performance of 87.61 per cent.
This significant disparity highlights the growing payment risk associated with international electricity sales.
NERC further explained that some bilateral customers—both domestic and international—made additional payments to offset outstanding invoices from previous quarters.
Specifically, the Market Operator received $7.84 million from international bilateral customers and N1.3 billion from domestic customers as part of efforts to clear backlog obligations.
Distribution Companies Improve Market Remittances
Beyond bilateral transactions, the commission reported improved performance among Nigeria’s electricity distribution companies (DisCos).
In the third quarter of 2025, the 11 DisCos collectively remitted N381.29 billion to the Nigerian Bulk Electricity Trading Plc (NBET) and the Market Operator.
This payment was made against a total invoice of N400.48 billion, resulting in a remittance performance of 95.21 per cent.
NERC noted that the figures were based on reconciled market settlements submitted as of December 18, 2025, in line with its statutory oversight responsibilities.
While the improved remittance by DisCos reflects gradual market stabilisation, regulators caution that persistent international payment defaults could undermine overall market confidence if not urgently addressed.
Broader Implications for Nigeria’s Power Sector
The revelation that Togo, Niger, and Benin owe Nigeria N25bn for electricity raises broader questions about the balance between regional cooperation and domestic economic realities.
Nigeria continues to struggle with electricity shortages at home, yet exports power to neighbouring countries under long-standing agreements.
Experts argue that while regional power trade supports diplomatic ties and regional stability, Nigeria must strengthen enforcement mechanisms, review contract terms, and ensure that foreign exchange earnings from power exports are promptly repatriated.
NERC has not announced immediate sanctions but is expected to intensify engagement with defaulting international customers.
Analysts believe stricter payment guarantees, revised billing structures, or escrow arrangements may be necessary to protect Nigeria’s interests going forward.
Calls for Stronger Oversight and Policy Review
As Nigeria pushes for power sector reforms and greater financial sustainability, stakeholders say unresolved international debts must not be ignored.
The growing unpaid balance highlights the need for stronger regulatory oversight, transparent reporting, and firm enforcement of bilateral power agreements.
With billions of naira tied up in unpaid invoices, resolving the issue of cross-border electricity debts could provide much-needed relief to Nigeria’s struggling power sector and improve investor confidence in the electricity market.
For now, the spotlight remains firmly on how regulators and policymakers will respond to the growing challenge posed by unpaid international electricity obligations—and whether Nigeria can strike a fair balance between regional leadership and domestic economic protection.
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