The Nigerian Electricity Regulatory Commission (NERC) has disclosed that electricity distribution companies (DisCos) collectively remitted a total of N1.18 trillion in 2024, reflecting an overall remittance performance of 86.47% and leaving a deficit of N185 billion.
This was revealed in NERC’s newly released 2024 Annual Report.
According to the Commission:
Eko, Ikeja, and Abuja DisCos recorded the highest remittance performances to the Nigerian Bulk Electricity Trading Plc (NBET) with 99.33%, 94.43%, and 90.42%, respectively.
Kaduna DisCo had the lowest remittance to NBET at 32.77%.
For remittances to the Market Operator (MO), Yola, Ikeja, Eko, and Abuja DisCos topped with 96.73%, 95.71%, 93.12%, and 92.97%, respectively, while Kaduna DisCo again recorded the lowest at 26.29%.
Persistent liquidity crisis
NERC raised concerns over the sector’s ongoing liquidity challenges, largely driven by DisCos’ failure to meet full remittance obligations. The report emphasised that:
The federal government continues to shoulder electricity subsidies, with DisCos’ inability to achieve 100% remittance limiting their revenue generation.
This hampers critical operational and capital investments, worsening the sector’s financial instability.
Ajaokuta Steel’s outstanding debts
The Commission also flagged Ajaokuta Steel Company Limited and its host community for failing to pay their N5.19 billion energy invoice to NBET and N44 million service charge to MO in 2024. NERC warned that continued non-payment could lead to disconnection over gross indebtedness, adding that the issue has been escalated to relevant federal ministries for resolution
Sector’s unsustainable subsidy burden
In February 2024, the federal government announced plans to phase out electricity subsidies due to unsustainable costs, revealing that:
Nigeria owes N1.3 trillion to generation companies (GenCos) and $1.3 billion to gas suppliers.
Only N450 billion was budgeted for electricity subsidies in the 2024 fiscal year.
Despite various interventions, the power sector remains constrained by underinvestment and liquidity shortfalls, limiting improvements in electricity supply across the country.
Credit: Nairametrics
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