By Abubakar Yunusa
The Nigerian Electricity Regulatory Commission (NERC) says the Nigerian Bulk Electricity Trading (NBET) Plc and the market operator (MO) issued an invoice of N3.10 trillion to electricity distribution companies (DisCos) and the government for energy costs and administrative charges in 2024.
In its 2024 annual report on Monday, NERC said DisCos accounted for N1.37 trillion of the total invoice, but remitted N1.18 trillion to NBET and MO — representing a gross remittance rate of 86.47 percent.
According to the commission, due to the absence of cost-reflective tariffs across all DisCos in 2024, NERC said the government incurred a subsidy obligation of N1.94 trillion — “62.59 percent of total invoice” — during the year.
NERC said the subsidy obligation amount averaged N161.85 billion per month.
“The gross invoice issued by NBET (DRO-adjusted) and MO for energy costs and administrative services to DisCos in 2024 was N1,370.35 billion,” the commission said.
“Out of this amount, the DisCos remitted a total of N1,184.88 billion, translating to a gross remittance rate of 86.47 percent. The resultant deficit/underpayment of N185.47 billion is known as “market shortfall” i.e. shortfall that is attributable to market participants.”
Out of the N1.16 trillion invoice issued by NBET in 2024, NERC said DisCos remitted N1 trillion, reflecting a remittance performance of 86.65 percent
The report further noted that the MO issued invoices totalling N209.95 billion to the DisCos, which collectively remitted N179.36 billion — amounting to an 85.43 percent remittance rate.
NERC said a comparative analysis of DisCos’ market invoice (NBET and MO) and remittance in 2024, showed that Eko, Ikeja, Yola, and Abuja DisCos “recorded remittance performances above 90% (98.56%, 94.61%, 92.10% and 90.80% respectively)”.
“Kaduna DisCo recorded the lowest remittance performance of 31.55% in 2024 due to its significant ATC&C loss underperformance,” the commission said.
Based on the remittance numbers and “non-funding of subsidies incurred in 2024 by the Federal government,” NERC said it is clear that the upstream segment of the market “continues to be plagued by liquidity challenges”.
“Under the payment assurance waterfall regime, DisCos’ inability to achieve 100% remittance to the upstream segment indicates that they were unable to earn significant portions of their allowed revenues,” the commission said.
“Without this, they would also be unable to undertake necessary operational/capital investments.”
Furthermore, NERC said there were “nine (9) incidents of system collapse in 2024”.
NERC said that out of the total grid collapses recorded, four were full, while five were partial disruptions.
Reports, however, had shown that the grid collapse occurred 11 times in the year.
