Nigeria’s electricity distribution companies have generated a total of N887.86 billion in revenue during the first seven months of 2024, driven by a tariff increase for Band A customers and enhanced revenue collection efforts, according to The Punch.
Despite ongoing consumer complaints about poor power supply and high tariffs, the 11 Discos reported a significant 46.96 per cent increase in income compared to N604.15 billion during the same period in 2023.
Additionally, stakeholders in the sector have reduced their borrowings from commercial banks by N28.82 billion, indicating a shift towards improved financial management.
An analysis of data from the Nigerian Electricity Regulatory Commission reveals that Nigeria’s electricity distribution companies (Discos) billed a total of N1.114 trillion from January to July 2024, achieving a revenue collection of N887.86 billion, which translates to a collection efficiency of 79.7 percent.
In the same period last year, the Discos issued bills totaling N797.18 billion and collected N604.15 billion.
Following a two-year tariff freeze, the Federal Government raised the rate for Band A customers from approximately N68 to N225 per kilowatt-hour in April 2024, citing their access to an average of 20 hours of electricity supply daily.
However, following public backlash, the Nigerian Electricity Regulatory Commission (NERC) announced an 8.1 percent reduction, bringing the rate down to N206.8/kWh. This increase in electricity tariffs has significantly impacted many Nigerians, resulting in heavier energy bills.
Last week, the Minister of Power, Adebayo Adelabu, assured Nigerians of a possible reduction in the price of electricity in the coming months, following a current effort to step up the generation and distribution of power.
However, Nigerians remain skeptical about the potential reduction, as many communities continue to appeal to be removed from the highest-paying tariff, which negatively impacts the cost of living and hampers economic growth.
A breakdown of the monthly revenue showed that N95bn was generated in January out of N130.92bn billed for the month.
The sum of N97bn was collected in February out of projected N113bn, N100.44bn was generated in March out of N126.56bn billed, N142.92bn was made in April out of N178.72bn, and N139.23bn was generated in May out of N191.65bn billed for the month.
In June, the revenue increased to N150.86bn out of an estimated billing of N176.57bn while N162.14bn was collected out of N197.11bn in July.
A comparison of the N95bn January revenue and N197.11bn generated in May gives a difference of N102.11bn, which is 107.48 per cent of the former.
With N887.86 billion collected in the first seven months of 2024, Nigeria’s electricity distribution companies (Discos) have already surpassed their total revenue for the entire year of 2020 and are on track to break records for 2021, 2022, and 2023 by year-end.
Data from the National Bureau of Statistics reveals a consistent increase in revenue: N526.8 billion in 2020, N761.2 billion in 2021, N828.1 billion in 2022, and N1.1 trillion in 2023.
Given this significant rise in revenue, industry experts anticipate that the Discos will reinvest a portion of these earnings into essential infrastructure improvements, addressing long-standing issues within the power sector.
