Mathew Amaechi
In a paradox that has sparked nationwide debate, electricity distribution companies (Discos) raked in N509.84 billion during the fourth quarter of 2024, despite Nigeria experiencing five major grid collapses in the same period.
According to a report by the Nigerian Electricity Regulatory Commission (NERC), the national grid suffered three incidents of total collapse and two of partial collapses in 2024/Q4. These disruptions underscore the growing challenges in maintaining a stable power supply, with partial collapses recorded on October 14 and November 5, and total collapses on October 19, November 7, and December 11.
While consumers endured frequent outages, Discos managed to boost their financial performance compared to the previous quarter, collecting N509.84bn in Q4 against N466.69bn in Q3. The report noted that this increase was accompanied by an improvement in collection efficiency—from 74.55 per cent in Q3 to 77.44 per cent in Q4—a rise of 2.89 percentage points. Energy analysts attribute this improvement to a reduction in energy offtake during the fourth quarter, which allowed Discos to concentrate on areas with lower billing and collection inefficiencies.
Performance among the various Discos, however, varied significantly. Eko and Ikeja DisCos led with collection efficiencies of 90 percent and 82.3 percent respectively, whereas Jos Disco lagged at a meager 49.68 percent. Notably, eight of the Discos recorded gains in collection efficiency between Q3 and Q4, with Yola and Kano marking the most significant improvements, at 13.93 and 9.88 percentage points respectively. Conversely, Jos and Abuja DisCos experienced declines by 3.61 and 3.39 percentage points.
NERC emphasized that maintaining grid stability is crucial for optimal performance. The national power grid, designed to operate within strict voltage (330kV ± 5.0%) and frequency (50Hz ± 0.5%) boundaries, is susceptible to outages when demand outstrips supply or vice versa. Any deviation from these stability parameters not only compromises power quality but can also trigger widespread outages, as seen in the recent incidents.
In a bid to prevent future collapses and improve revenue recovery, NERC is urging Discos to adopt proven strategies such as accurate customer enumeration and the installation of end-use customer meters. In line with this recommendation, the commission had earlier issued an order in Q2 2024 for the operationalisation of Tranche A of the Meter Acquisition Fund (MAF). Effective from June 24, this order directed Discos to prioritize the procurement and installation of meters for unmetered Band A customers. As of December 2024, more than 4,000 such customers have been metered under the MAF scheme. Additional metering frameworks provided in the NERC MAP and NMMP metering regulation (2021) are also expected to play a pivotal role in reducing commercial and collection losses.
Despite the improved financial performance in Q4, recent partial grid collapses in the first quarter of 2025 indicate that the challenges in Nigeria’s power sector persist. As Discos continue to thrive monetarily, the pressing need for robust grid infrastructure and effective energy management remains a top priority for both regulators and the broader public.