Nigeria’s electricity Distribution Companies (DisCos) have recorded a dramatic increase in revenue over the past eight years, with collections rising from ₦218.16 billion in the first half of 2018 to about ₦1.2 trillion in the first half of 2026.
The increase represents a rise of roughly 450 per cent, according to data from the Nigerian Electricity Regulatory Commission (NERC) analysed by Financial Vanguard. However, the sharp growth in revenue has occurred alongside much slower growth in electricity supply, highlighting the continuing financial and operational challenges within Nigeria’s power sector.
During the same period, total electricity supply increased by only 4.8 per cent, from 16,861 gigawatt-hours (GWh) in the first half of 2018 to 17,668GWh in the first half of 2026. Average available generation capacity also declined significantly, falling by about 41 per cent, from 7,565.5 megawatts (MW) to 4,456MW.
The figures have renewed questions about the relationship between electricity tariffs, consumer payments, power availability and the quality of service delivered by Nigeria’s distribution companies.
Revenue growth far exceeds electricity supply growth
The difference between revenue growth and electricity supply growth is one of the most striking aspects of the NERC data.
While DisCos' revenue increased by approximately ₦983.04 billion between the first halves of 2018 and 2026, electricity supplied through the distribution network increased by only 807GWh, representing a growth rate of 4.8 per cent.
In simple terms, the amount of money collected by DisCos has expanded dramatically without a comparable increase in the volume of electricity flowing through the system.
This does not necessarily mean that DisCos' profits have increased by the same percentage. Revenue is the amount collected from customers and is different from profit, which depends on operating expenses, energy purchase costs, technical and commercial losses, financing obligations and other costs.
The figures nevertheless show how significantly the financial value of electricity sales has changed over the period.
The increase has coincided with reforms to electricity tariffs and changes in the pricing structure of the Nigerian Electricity Supply Industry (NESI), as well as broader increases in the naira cost of operating the power sector.
DisCos collected about ₦1.2 trillion in six months
The scale of the latest revenue figure is particularly significant.
Nigeria's 11 DisCos collected approximately ₦1.2 trillion between January and June 2026, according to NERC's commercial performance data.
Monthly collections were above ₦190 billion throughout the first half of the year. The DisCos collected ₦204.75 billion in January, ₦196.68 billion in February, ₦196.13 billion in March, ₦203.61 billion in April and ₦208.15 billion in May before collections fell to about ₦191.68 billion in June.
May was therefore the strongest month during the six-month period, while June recorded a noticeable decline.
The figures demonstrate that electricity consumers are collectively paying substantial amounts to distribution companies despite the persistent complaints about power availability, billing and service quality across many parts of the country.
However, the amount collected represents only part of what was billed to customers.
₦700 billion remained uncollected
NERC data also show a significant gap between the value of electricity received by the DisCos and the revenue they actually collected.
During the first half of 2026, the 11 distribution companies received energy valued at approximately ₦1.9 trillion, but collected about ₦1.2 trillion from consumers. This left an estimated ₦700.53 billion gap.
The figure is important because it illustrates that the sector's problem is not simply about how much money consumers are paying.
DisCos still face substantial collection challenges, with part of the electricity billed to customers not translating into cash received by the companies.
The reasons can vary across distribution territories and may include billing disputes, electricity theft, meter-related problems, technical losses, commercial losses and customers failing to pay bills.
The size of the gap also has implications for the wider electricity value chain because DisCos need sufficient cash flow to meet financial obligations to other participants in the market.
June figures highlight collection problems
NERC's June 2026 figures provide another illustration of the challenge.
During the month, DisCos received about 315.73 billion kWh of electricity from the market and billed 240.71 billion kWh to customers, producing a billing efficiency of 76.24 per cent. Actual revenue collection was around ₦191.86 billion against billings of ₦240.71 billion, leaving a gap of approximately ₦48.85 billion for the month.
The regulator also reported an average allowed tariff of ₦130.15 per kWh in June, while the actual average amount recovered was ₦96.63 per kWh.
That translated into revenue recovery efficiency of 74.24 per cent.
The figures show why an increase in headline revenue does not necessarily mean that the distribution segment is operating without financial pressure. Companies may collect more money overall while still failing to recover the full economic value of the electricity supplied to them.
Available generation capacity falls 41%
Perhaps even more striking than the gap between revenue and electricity supply is the decline in average available generation capacity.
According to the NERC data cited in the report, average available generation capacity fell from 7,565.5MW in the first half of 2018 to 4,456MW in the first half of 2026, representing a decline of about 41 per cent.
This means that although Nigeria has continued to collect significantly more revenue from electricity customers, the amount of generation capacity available to the system has not expanded in parallel.
The distinction between installed capacity and available capacity is important.
Nigeria has a large amount of installed generation capacity on paper, but not all of that capacity is available to generate electricity at any given time. Equipment problems, gas supply constraints, maintenance requirements, financing difficulties and other operational issues can prevent plants from producing at their installed capacity.
The result is a system in which consumers may face unreliable supply even as the monetary value of electricity transactions continues to rise.
Annual DisCo revenue has also surged
The trend becomes even clearer when longer-term annual figures are examined.
DisCos' annual revenue increased from approximately ₦302.93 billion in 2016 to ₦2.3188 trillion in 2025, representing growth of about 666 per cent over the nine-year period.
Revenue rose progressively during the period, reaching ₦370.456 billion in 2017, ₦448.749 billion in 2019, ₦542.729 billion in 2020, ₦775.336 billion in 2021 and ₦841.811 billion in 2022.
Collections then accelerated, reaching approximately ₦1.0775 trillion in 2023, ₦1.6597 trillion in 2024 and ₦2.3188 trillion in 2025.
By contrast, annual electricity supply increased at a much slower pace.
Supply stood at 23,742GWh in 2016 and increased to 31,251GWh in 2025, representing growth of about 31.6 per cent over the period.
The divergence means that the growth in the amount of money collected has significantly outpaced the growth in the volume of electricity supplied.
2025 exposed the widening gap
The disparity was particularly visible in 2025.
According to the NERC data, annual DisCo revenue increased from ₦1.6597 trillion in 2024 to ₦2.3188 trillion in 2025.
However, electricity supply moved in the opposite direction, falling from 37,093.70GWh in 2024 to 31,251GWh in 2025, a decline of approximately 15.7 per cent.
That combination is significant because it shows that higher electricity revenue does not automatically correspond to higher electricity supply.
There are several factors that can influence revenue independently of the physical quantity of electricity supplied, including tariff changes, customer classification, collection efficiency and the naira value of electricity sold.
Consequently, the revenue numbers should not be interpreted as evidence that consumers received 450 per cent more electricity than they did eight years ago.
The data show the opposite: electricity supply grew only marginally over the comparable first-half period.
Thirteen years after privatisation, structural challenges remain
Nigeria's power sector was largely privatised in November 2013, when generation companies and 11 distribution companies were transferred to private investors, while transmission remained under government control.
The reform was intended to improve efficiency, attract private capital and create a commercially sustainable electricity market.
More than a decade later, however, the sector continues to face challenges across generation, transmission and distribution.
NERC data cited by Financial Vanguard show that in 2016, average available generation capacity from 27 power plants stood at 7,527MW, while actual average generation was approximately 3,276MW.
By 2025, installed generation capacity had risen above 13,000MW, but average available capacity had fallen to 5,398MW. Average generation, meanwhile, increased to 4,475MW.
The figures illustrate the difference between having generating assets on paper and having enough reliable capacity available to serve customers.
Government faces wider power-sector financial obligations
The financial difficulties are not limited to DisCos.
The Federal Government has accumulated substantial obligations within the electricity market, particularly in relation to subsidies and debts owed to power generation companies.
According to the figures reported by Financial Vanguard, the Federal Government's gross tariff subsidy obligation was approximately ₦1.928 trillion in 2025, equivalent to 57.44 per cent of the total NBET invoice for the year.
The government has also been using debt instruments as part of efforts to address legacy obligations in the sector.
In September 2026, the government signed a ₦728.979 billion Series 2 bond under its Power Sector Debt Reduction Programme. The transaction consisted of ₦402 billion in cash bonds and ₦326.979 billion in non-cash bonds allocated to participating generation companies.
The objective is to address verified legacy debts and improve liquidity across the electricity supply chain.
Power Minister says supply is improving
Despite the concerns highlighted by the long-term data, the Federal Government has argued that electricity supply has begun improving in recent months.
Power Minister Joseph Tegbe said operational records showed generation and transmission above 5,000MW over recent weeks, compared with a range of roughly 3,700MW to 4,700MW before June.
He also cited a generation peak of 5,330MW during August and September and said the government's priority was to convert improvements at the generation and transmission levels into more dependable supply for customers.
The minister also pointed to infrastructure interventions, including the restoration of the 375MW Alaoji open-cycle power plant and upgrades to several transmission substations.
According to the ministry, new transformers at Apapa, Ijora, Alausa and Lekki unlocked 672MW of transmission capacity, while a new 300MVA transformer at Katampe in Abuja unlocked another 240MW.
These interventions indicate that the government is attempting to address some of the physical constraints affecting electricity delivery.
What the revenue surge means for consumers
For electricity consumers, the most important question is not simply how much money DisCos collect but what consumers receive in return.
A rise in revenue can strengthen a distribution company's ability to invest in infrastructure, improve metering, maintain networks and meet its obligations to the wider electricity market.
But higher revenue alone does not guarantee better electricity supply.
The first-half figures demonstrate this distinction clearly. DisCo revenue increased by approximately 450 per cent between H1 2018 and H1 2026, while electricity supply increased by only 4.8 per cent. At the same time, average available generation capacity declined by about 41 per cent.
This suggests that the industry's financial growth and its physical service capacity have not moved at the same pace.
For households and businesses, that gap remains important because unreliable electricity forces many consumers to rely on petrol- and diesel-powered generators or alternative energy systems, adding to their operating costs.
The bigger challenge is turning revenue into reliable power
The latest figures provide a mixed picture of Nigeria's electricity market.
On one hand, DisCos are collecting significantly more money than they did eight years ago. The increase from ₦218.16 billion to approximately ₦1.2 trillion in first-half revenue represents a major expansion in the monetary value of electricity collections.
On the other hand, electricity supply has grown by only 4.8 per cent over the same period, while available generation capacity has fallen by 41 per cent.
There is also a substantial collection gap, with about ₦700.53 billion worth of energy received by DisCos in the first half of 2026 reportedly not translating into collected revenue.
The figures therefore point to a power sector still struggling with the fundamental challenge of converting electricity generation, distribution and customer payments into a financially sustainable system capable of providing reliable service.
For Nigeria's electricity reforms to deliver their intended benefits, sustained attention will be required not only on tariffs and revenue collection but also on generation capacity, transmission infrastructure, metering, losses, collection efficiency and the settlement of debts throughout the electricity value chain.
The 450 per cent increase in DisCo revenue is consequently a major financial development, but the much smaller increase in electricity supply shows that the sector's underlying infrastructure and service-delivery challenges remain unresolved.
