Owing to the freezing of the cost-reflective tariff in the Nigerian Electricity Supply Industry (NESI), the Federal Government paid N1.928trillion subsidy in 2025.
The subsidy is the resultant gas between the cost-reflective and the allowed tariff, which is obligatory on the Federal Government to pay.
This was contained in the Nigerian Electricity Regulatory Commission (NERC) 2025 Annual Report that was released yesterday.
The report said, “Tariff Subsidies: When the allowed end-user electricity tariffs (allowed tariff) are lower than the cost-reflective tariff as computed by the Commission, the Government undertakes to cover the resultant gap shortfall funding.
“In 2025, the gross subsidy obligation of the FGN was ₦1.928.31 trillion.”
On Market Remittance by the Electricity Distribution Companies (DisCos), NERC revealed that in the period under review, the Nigerian Bulk Electricity Trading Company (NBET) and Market Operator (MO) issued a gross invoice of ₦1.721.624 trillion to all the DisCos for energy costs and administrative services. NigerianNews Portal
According to the report the DisCos remitted a gross sum of ₦1.632.04 trillion, translating to an overall remittance performance of 94.80%.
NERC said the resultant deficit/underpayment of ₦89.58 billion is known as “market shortfall”, i.e., a shortfall that is attributable to market participants.
The report said Eko, Ikeja and Port Harcourt DisCos achieved 100% remittance performance to NBET in 2025, while Kaduna DisCo (40.13%) achieved the lowest remittance performance to NBET.
It added that Abuja, Benin, Eko, Enugu, Ikeja, Port Harcourt and Yola DisCos achieved 100% remittance performance to the MO in 2025.
According to the report, Kaduna DisCo (48.11%) recorded the lowest remittance performance to the MO in 2025.
On Market Remittances by Special and Bilateral Customers: NERC also revealed that in 2025, the NESI continued to provide electricity to three international bilateral customers – i) Societe Beninoise d’Energie Electrique; ii) Compagnie
Energie Electrique du Togo; iii) Societe Nigerienne d’electricite. The are Niger Republic, Togo and Republic of Benin.
Cumulatively, the report said the three customers received an invoice of $73.91 million from MO and made a payment of $62.75 million.
NERC said remittance corresponds to a remittance performance of 84.90%. The report stressed that the domestic bilateral customers received a total invoice of ₦13,203.50 million from MO and made a payment of ₦12,754.58 million, corresponding to a remittance performance of 96.60%.
NERC also disclosed that in the period under review, the average available generation capacity of the grid-connected power plants was 5,398.33MW.
The availability factor for all grid-connected plants, said NERC, was 39.62%, which indicates that more than 60% of the installed capacity in the NESI was not available in 2025.
The report said the total generation during the year was 39,208.68GWh, which translates to an average hourly generation of 4,475.88MWh/h.
It added that hydropower plants contributed 12,804.18GWh (32.66%) to the total generation in 2025.
Credit: punchng.com
