Key points
- Nigeria’s electricity generation and available capacity declined in the first quarter of 2026.
- DisCos recorded weaker billing and collection performance, while customer complaints surged.
- Meter installations increased and remittances to upstream market participants improved.
- NERC issued new regulations and licences as electricity sector reforms gathered pace.
Main story
Nigeria’s electricity generation declined in the first quarter of 2026 as lower available generation capacity, weaker commercial performance and rising consumer complaints continued to weigh on the country’s power sector, according to the Nigerian Electricity Regulatory Commission (NERC).
The commission disclosed this in its First Quarter 2026 Report, released under the Electricity Act 2023 to assess the operational, commercial and regulatory performance of the Nigerian Electricity Supply Industry (NESI).
According to the report, average available generation capacity fell by 17.45 per cent to 4,457.96 megawatts (MW) from 5,400.38MW recorded in the fourth quarter of 2025.
Average hourly electricity generation also declined to 4,112.72 megawatt-hours per hour (MWh/h), while total electricity generated during the quarter dropped to 8,883.47 gigawatt-hours (GWh), nearly 950GWh lower than the previous quarter.
NERC attributed the decline to reduced water levels affecting hydropower generation, maintenance shutdowns, mechanical faults and gas supply constraints.
The commission said only 32.72 per cent of Nigeria’s installed generation capacity was available for dispatch during the period, although utilisation of available plants improved as the system load factor increased to 92.26 per cent.
The report also showed that distribution companies billed customers for electricity worth N756.93 billion out of N955.19 billion supplied to the distribution network, representing a billing efficiency of 79.24 per cent.
Of the amount billed, DisCos collected N597.56 billion, translating to a collection efficiency of 78.95 per cent.
Aggregate Technical, Commercial and Collection (ATC&C) losses stood at 37.44 per cent, more than double the regulatory target of 16.92 per cent, resulting in estimated revenue losses of N140.64 billion.
Despite the challenges, remittances by distribution companies to upstream market participants improved to 94.08 per cent during the quarter.
The report also showed progress in electricity metering, with 357,495 new meters installed, increasing the national metering rate to 59.13 per cent.
However, more than five million electricity customers remained unmetered, while complaints received by distribution companies rose sharply to 91,617 during the quarter, largely over metering, billing and power supply.
On the regulatory front, NERC issued 36 regulatory orders, approved 48 licences, permits and certifications, and transferred electricity market oversight in Gombe State to the Gombe State Electricity Regulatory Commission as implementation of the Electricity Act 2023 continued.
The issues
The report underscores the persistent structural challenges facing Nigeria’s electricity sector, including inadequate generation capacity, transmission instability, high technical and commercial losses, weak revenue collection and insufficient metering. Although regulatory reforms, improved market remittances and increased metering recorded positive gains, the Federal Government continued subsidising about 52 per cent of generation costs because retail electricity tariffs remained frozen at July 2024 levels. NERC said sustained investment, stronger enforcement and continued reforms would be required to build a more reliable and financially sustainable electricity market.
What’s being said
“Average available generation capacity fell by 17.45 per cent during the first quarter of 2026.” — NERC Q1 2026 Report
“Aggregate Technical, Commercial and Collection losses reached 37.44 per cent against a regulatory target of 16.92 per cent.” — NERC Q1 2026 Report
What’s next
NERC is expected to continue implementing reforms under the Electricity Act 2023, expand metering, strengthen regulatory oversight and support state electricity markets as efforts continue to improve operational efficiency and financial sustainability across the power sector.
Bottom line
NERC’s first-quarter report shows Nigeria’s power sector remained under pressure from weaker electricity generation, high distribution losses and rising consumer complaints, despite progress in metering, regulatory reforms and market remittances.
