- Nigerian Electricity Distribution Companies (DisCos) reported N431.16 billion in customer revenues for Q2 2024, achieving a collection efficiency of 79.31%, a slight improvement from the previous quarter.
- Despite ongoing challenges, including a N1.3 trillion debt to gas suppliers, the federal government has paid nearly N205 billion to enhance energy output and improve sector liquidity.
In the second quarter of 2024, Nigerian Electricity Distribution Companies (DisCos) reported a total customer revenue of N431.16 billion, achieving a collection efficiency of 79.31%. This figure, detailed in the Nigerian Electricity Regulatory Commission’s (NERC) quarterly report, reflects a slight improvement over the previous quarter’s collection efficiency of 79.11%, indicating a 0.20 percentage point increase.
Despite the ongoing challenges within the power sector, DisCos have demonstrated improved capability in recovering billed revenues, as evidenced by the rise in collection efficiency. The report also highlights adjustments to DisCos’ remittance obligations to upstream market players.
In Q2 2024, the total upstream invoice due for DisCos was N399.53 billion, which included N55.77 billion for services from the Market Operator (MO) and N343.76 billion for generating costs adjusted by the Nigerian Bulk Electricity Trading (NBET). They were following their remittances, totalling N318.65 billion, comprising N271.87 billion for NBET and N46.78 billion for the MO.
An outstanding balance of N80.88 billion remains. This results in a remittance performance of 79.76% for Q2 2024, a notable decline from the 96.93% performance recorded in the first quarter.
The report also illuminates the remittance performance of bilateral and special clients, indicating similar trends. For services rendered in Q2 2024, four international bilateral clients served by the Nigerian Electricity Supply Industry (NESI) paid $9.81 million against an invoiced amount of $15.60 million.
Domestically, bilateral clients contributed N1.2 billion out of a total invoiced value of N1.9 billion. Despite multiple government interventions, Nigeria’s power sector grapples with significant challenges due to underinvestment and ongoing liquidity issues.
To address the N1.3 trillion debt owed to gas suppliers within the NESI, the federal government initiated a payment plan starting in May, disbursing N130 billion. To date, gas suppliers have received nearly N205 billion to enhance energy output nationwide.
This ongoing debt repayment strategy is part of a broader government initiative to improve sector liquidity and increase electricity supply. However, the persistent difficulties in managing remittances, maximising collection rates, and minimising losses underscore the more profound issues plaguing Nigeria’s electricity distribution landscape.
The road ahead remains challenging as stakeholders seek sustainable solutions to stabilise the sector.