Despite persistent power outages and poor service delivery, Nigeria’s electricity distribution companies (Discos) have seen a significant boost in revenue.
According to a recent data released by the Nigerian Electricity Regulatory Commission (NERC), the 11 Discos collectively raked in N887.86 billion in the first seven months of 2024, a 46.96percent increase compared to the same period in 2023.
The surge in revenue is directly linked to the tariff hike implemented by the Federal Government in April 2024. The move, aimed at improving the financial health of the power sector, raised the tariff for Band A customers, who were promised 20 hours of daily power supply.
However, many consumers have reported experiencing far less supply, often enduring long hours of outages.
For many Nigerians, these tariff hikes and service inconsistencies reflect a growing disparity between consumer costs and the quality of service provided.
Ibrahim Musa, a business owner in Ikeja area of Lagos, shared his frustration: “I’m paying triple what I used to, but we barely have consistent power. I can’t keep relying on a generator because fuel prices are high. This situation is unsustainable.”
Ibrahim is among thousands of Nigerians who feel that while Discos’ profits soar, the service remains unreliable and even hazardous in emergencies.
A critical part of the issue lies in the Discos’ collection efficiency—at nearly 80 percent, they are collecting record amounts, yet the funds don’t seem to be translating to operational improvements. With the tariffs on the rise, household energy bills now consume a more significant portion of family budgets.
Folake, a mother of three, worries about the coming months: “As we approach Christmas, I don’t know how I’ll manage the expenses. I used to stock up on food and essentials, but with the power issues and the costs, I don’t even know if we’ll have consistent electricity to keep food fresh.”
Read also: Unmetered customers hit 7.3 million as Discos install 672,539 meters
Discos neglect infrastructure, consumers bear the brunt
Residents of Itoko Avenue in Igando, Lagos, are grappling with persistent power outages. The community, like many others across Nigeria, has taken matters into their own hands, purchasing a new transformer to alleviate the burden of frequent power failures.
However, the electricity distribution company, Ikeja Electric, has refused to energise the new transformer, leaving residents to rely on an aging and unreliable infrastructure. This has led to prolonged power outages, affecting businesses, schools, and households.
“It’s frustrating to pay exorbitant electricity bills for such poor service,” lamented Adeola, a resident of Itoko Avenue. “We’ve invested in a new transformer to improve our power supply, but the Disco is refusing to activate it. This is sheer negligence.”
Emeka, another resident, echoed the frustration. “We’ve been dealing with power outages for years. Ikeja Electric don’t seem to care about our plight. We’re tired of the constant excuses and empty promises,” he said.
“We recently had an outage that lasted weeks, and they only sent someone after we’ve made several complaints. It’s depressing,” another resident lamented. “A community still rationing power in 2024.”
The situation in Itoko Avenue reflects a broader problem in Nigeria’s power sector. Despite the government’s calls for improved infrastructure and service delivery, many Discos continue to prioritise profit over consumer satisfaction.
While some argue that the country’s aging transmission infrastructure is partly to blame, others contend that it’s a matter of priority.
“The Discos are simply not incentivised to address complaints promptly. They know their revenue is locked in with tariffs, so what pressure do they have to make the fixes? Meanwhile, consumers are powerless to seek better alternatives,” said Aminah Afolabi, a consumer advocate.
While the profits and performance targets in the current band system were meant to boost Nigeria’s ailing power sector, the structure has inadvertently driven up consumer costs without significant improvement in supply.
Until stricter oversight and reinvestment mandates are imposed, many worry that the system will continue to benefit Discos at the expense of the average Nigerian.
Regulatory intervention remains an option, with Nigerians calling for NERC to reassess the parameters of the band system.
Moshood Adewale, an electrical engineer, believes that “tariffs should be tied to measurable service improvements. If Discos fail to meet standards, they should be fined or required to invest directly in the grid. Anything less is unfair to consumers.”
Consumers are increasingly frustrated with the lack of accountability and transparency in the power sector. As the demand for electricity continues to grow, it is imperative for the government and regulatory agencies to take decisive action to address the challenges facing the industry.
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