- NERC reports a N156bn drop in DisCos' mandatory remittances to NBET and MO for the first three quarters of 2024, despite a rise in total revenues
- DisCos show declining remittance performance, with Q2 and Q3 2024 seeing significant shortfalls, despite higher revenues in the third quarter
- Eko Disco leads in collection efficiency, while Kaduna Disco struggles with the lowest performance rate, highlighting ongoing challenges in Nigeria’s electricity sector
The Nigerian Electricity Regulatory Commission (NERC) has revealed a significant drop in the mandatory remittance of electricity distribution companies (DisCos) to the Nigerian Bulk Electricity Trading (NBET) and the Market Operator (MO) for the first nine months of 2024.
The data shows a decline of N156bn in remittances.
In the first quarter of 2024, the DisCos were expected to remit N114.12bn, but they managed to pay N110.62bn, which is 96.93% of the required amount.
Of this amount, N65.52bn went to NBET, and N45.10bn was allocated to MO, leaving an outstanding balance of N3.50bn. This remittance performance marked an improvement over the previous quarter (2023/Q4), where the performance was just 69.88%.
However, the second quarter of 2024 showed a decline in remittance performance.
The DisCos collected N431.16bn in revenue, reflecting a 47.84% increase compared to the first quarter. Despite the increase in revenue, the DisCos only remitted N318.65bn to NBET and MO out of the N399.53bn due, resulting in an 79.76% remittance performance rate.
The outstanding balance for the second quarter was N80.88bn, a significant drop compared to the first quarter.
In the third quarter, the total amount the DisCos were required to remit was N441.67bn, with N382.9bn allocated to NBET and N58.77bn to MO.
However, the DisCos remitted only N370bn—N324.83bn to NBET and N45.18bn to MO—leaving an outstanding balance of N71.66bn.
This marks a cumulative shortfall of approximately N156bn in remittances across the three quarters.
Despite these shortfalls, the total revenue collected by the DisCos increased by 8.2% in the third quarter, totaling N466.69bn, up from N431.16bn in the second quarter.
However, this led to a decrease in collection efficiency, with a performance rate of 74.55% in Q3, down from 79.31% in Q2.
In terms of performance, Eko Disco had the highest collection efficiency in the third quarter at 84.4%, followed closely by Ikeja Disco with 83.78%.
On the other hand, Kaduna Disco had the lowest collection efficiency at just 46.42%, collecting only N11.4bn out of the N24.5bn billed to customers.
This drop in remittances and collection efficiency highlights ongoing challenges in Nigeria's electricity sector.
Nigeria loses $26bn yearly to electricity shortages –Report
Meanwhile, TheRadar reported that Nigeria suffers an estimated annual economic loss of $26 billion due to electricity shortages, according to a report, Africa Trade Barometer, by the Standard Bank.
According to the report, businesses shore up electricity shortages by spending nearly $22 billion annually on off-grid fuel, which leads to increased operational costs.
