For the third quarter of 2024, Distribution Companies’ (DisCos’) revenue collection efficiency decreased, according to the Nigerian Electricity Regulatory Commission (NERC).
The efficiency rate fell from 79.31% in Q2 to 74.55% in Q3, a decline of 4.76 percentage points.
The Commission’s Q3 2024 report, which was made public on Friday, included this information.
Despite a rise in total income collected, this drop demonstrates the mounting issues facing the country’s power distribution business.
According to the study, DisCos collected N466.69 billion in Q3 from N626.02 billion in customer bills, whereas in Q2 they collected N431.16 billion from N543.64 billion in customer bills.
“Out of the N626.02 billion that was billed to customers in 2024/Q3, N466.69 billion was the total revenue collected by all DisCos.”
“This translates to a collection efficiency of 74.55%. In comparison, the total revenue collected by all DisCos in 2024/Q2 was N431.16 billion out of the N543.64 billion billed to customers which translated to a 79.31% collection efficiency. The 74.55% collection efficiency recorded in 2024/Q3 is -4.76pp lower than the collection efficiency recorded in 2024/Q2 (79.31%),” the report read in part.
Highlights of the Performance: Champions and Underdogs
- Top Performers:
With a collection efficiency of 84.40%, Eko DisCo was the most effective performer, closely followed by Ikeja DisCo (83.78%). Better operational strategies and consumer compliance in their respective regions are shown in these companies’ consistent leadership.
- Poorest Performers:
With the lowest collection effectiveness of 46.42%, Kaduna DisCo demonstrated severe difficulties in recovering its revenue. Jos DisCo, which saw a significant drop in efficiency, came next.
- Improvements:
In comparison to Q2, only Ibadan DisCo (+6.59pp) and Enugu DisCo (+2.88pp) saw gains in Q3.
- Declines:
The efficiency of the other nine DisCos decreased, with the biggest losses occurring in Kaduna (-14.20pp) and Jos (-12.09pp).
According to data trends, an increase in energy offtake during the period may have contributed to the recent fall in Distribution Companies’ (DisCos’) revenue collection efficiency between Q2 and Q3 2024.
“This is because it has been observed that DisCos frequently allocate the incremental energy to areas where they record higher inefficiencies when there is a higher energy offtake,” the report says.
What To Note
NERC increased the electricity rate for those that receive 20 hours of power per day on April 3, 2024.
Band A consumers could stop paying the new electricity cost if they are without power for up to 20 hours every day, according to Minister of Power Adebayo Adelabu.
Experts assert that further funding is still required for the electricity industry, particularly to alleviate the sector’s infrastructure shortage.
