Consumers pay $196.68 billion for electricity in February amid persistent energy problems

Electricity consumers across Nigeria paid a total of 196.68 billion naira for electricity in February 2026, despite continued complaints of poor and unstable electricity supply, latest data from the Nigerian Electricity Regulatory Commission (NERC) has revealed.

The figure represents a decline of 3.9% from the 204.75 billion naira collected by electricity distribution companies (DisCos) in January, indicating a decline in monthly revenue performance in the sector.

According to NERC’s February report on the business performance of DisCos, utility companies achieved a collection efficiency of 81.17%. This was after billing customers N242.29 billion for electricity consumed during the period.

However, the report showed that approximately $45.61 billion remained uncollected, underscoring persistent revenue losses and payment inefficiencies in the sector.

Furthermore, electricity distribution companies have experienced significant financial losses resulting from billing inefficiencies. NERC revealed that companies suffered losses of about N34.8 billion, despite receiving electricity worth N277.09 billion from generation companies in the month under review.

The development highlights the ongoing structural and operational challenges facing Nigeria’s energy sector, particularly in the areas of revenue recovery, energy accounting and market efficiency.

Meanwhile, energy expert, Prof. Wumi Iledare, has criticized the sector’s persistent underperformance, arguing that Nigeria’s electricity challenges go beyond technical solutions and tariff reviews.

According to him, the crisis in the energy sector will remain unresolved unless policymakers shift focus from “what is” to “what should be” when designing electricity market reforms.

He noted that while much of the debate has focused on engineering solutions, electricity systems are fundamentally driven by economics, institutional capacity and public policy frameworks.

“Technology provides electrons; economics determines whether those electrons are affordable, available, reliable and sustainable,” Iledare said.

The professor argued that tariffs should not be treated as the starting point of reform but rather as the result of deeper structural realities, including cost recovery mechanisms, fuel supply stability, transmission constraints, governance efficiency and policy coherence.

He also criticized ongoing reforms focused on decentralisation, warning that fragmentation without a coherent industrial policy could worsen the sector’s inefficiencies.

Iledare also raised concerns about the classification of consumers in the electricity market, stressing that residential, commercial and industrial users have different consumption patterns and economic roles that need to be adequately reflected in pricing frameworks.

According to him, Nigeria’s rapid move away from a vertically integrated electricity system has not been accompanied by adequate institutional strengthening, regulatory depth and infrastructure development, a gap that has contributed to liquidity problems and persistent revenue shortfalls.

He called for a deliberate shift towards electricity sector economics and development-focused policy planning, insisting that Nigeria must first define the type of energy system needed to support industrialisation, energy security and inclusive growth before designing market structures around it.

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