Band A Users to Get Relief as NERC Orders DisCos Compensation Plan

Band A Users to Get Relief as NERC Orders DisCos Compensation Plan

The Nigerian Electricity Regulatory Commission (NERC) has approved a compensation framework for eligible Band A electricity customers affected by prolonged power shortages across Nigeria, following widespread generation and transmission constraints within the Nigerian Electricity Supply Industry (NESI).

According to a public notice issued on Thursday, the regulator said the decision covers service disruptions recorded between February and March 2026, during which several Distribution Companies (DisCos) failed to meet the minimum supply threshold required under the Band A service-based tariff regime.

The affected DisCos include major operators such as Abuja Electricity Distribution Company (AEDC), Ikeja Electric, Eko Electricity Distribution Company (EKEDC), Ibadan Electricity Distribution Company (IBEDC), Port Harcourt Electricity Distribution Company (PHED), Kano Electricity Distribution Company (KEDCO), Kaduna Electricity Distribution Company (KAEDCO), and Benin Electricity Distribution Company (BEDC).

NERC attributed the shortfall in electricity supply to a combination of inadequate gas supply to thermal power plants, grid constraints, and vandalism of critical gas and transmission infrastructure, which significantly reduced available generation capacity during the review period.

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Under the approved compensation arrangement, feeders that supplied between 18 and 20 hours of electricity daily will still qualify for partial relief under the existing regulatory framework covering both Maximum Demand (MD) and Non-Maximum Demand (Non-MD) customers.

However, customers on Band A feeders that received less than 18 hours of supply daily during the affected months will receive additional compensation. NERC clarified that such feeders will not be downgraded for the period under review despite failing to meet the required service standard.

For Non-MD customers, compensation will be calculated at 20 per cent of the approved February 2026 energy cap applicable to their feeders, while MD customers will receive compensation equivalent to 20 per cent of their average billed energy for February 2026.

The commission directed that prepaid customers should receive compensation through token credits, while postpaid customers will benefit from bill adjustments reflecting the value of the shortfall.

NERC further instructed that DisCos must complete compensation payments for February 2026 by May 31, 2026, while March 2026 compensation must be implemented no later than June 30, 2026.

It also warned DisCos against using compensation credits to offset customer debts, stressing that customers must be clearly informed of the value, period, and basis of the compensation.

The regulator said the intervention is part of ongoing efforts to strengthen consumer protection under Nigeria’s electricity market reform programme, ensuring that tariff increases under the Band A structure are matched with measurable service delivery.

Industry stakeholders have long criticised inconsistent power supply under the Band A classification, arguing that many customers continue to receive less than the promised 20 hours of electricity per day despite paying higher tariffs.

NERC said it will closely monitor compliance by all DisCos and conduct verification exercises to ensure affected customers receive full entitlements, warning that further regulatory sanctions may apply in cases of non-compliance.

 

 

Band A Users to Get Relief as NERC Orders DisCos Compensation Plan