The Nigerian Electricity Regulatory Commission (NERC) has approved special compensation for eligible Band A electricity customers who experienced service shortfalls between February and March 2026 due to grid generation constraints.
NERC issued the approval in a directive No. NERC/2026/002, according to a notice released by the commission on Thursday.
The commission said the directive was introduced in recognition of the significant generation shortfalls experienced across the Nigerian Electricity Supply Industry (NESI) between February and March 2026, which affected the ability of Distribution Companies (DisCos) to meet the committed service levels for some Band A customers.
In February, the Nigerian Independent System Operator (NISO) attributed the country’s dwindling electricity generation to inadequate gas supply to thermal generating stations.
At the time, the system operator said the current energy allocated to DisCos reflects the reduced supply available on the grid.
On Thursday, NERC said the shortfalls were largely attributed to inadequate gas supply and vandalism of critical gas and transmission infrastructure, factors beyond the direct operational control of the DisCos.
Details of the directive
NERC said the compensation scheme applies to the period covering February to March 2026.
The commission said that where a Band A feeder recorded an average daily supply of between 18 and 20 hours, the existing compensation framework under Addendum No. NERC/2024/003 shall apply to both Maximum Demand (MD) and Non-Maximum Demand (Non-MD) customers.
It added that affected Band A feeders with less than 18 hours’ supply will not be downgraded during the covered period.
“The eligible customers will receive special compensation as follows: Non-MD customers: compensation equivalent to 20 per cent of the approved February 2026 energy cap applicable to the affected feeder.
“MD customers: compensation equivalent to 20 per cent of the average energy billed per MD customer in February 2026,” the commission said.
Mode of compensation
The commission said the prepaid customers will receive compensation through token credits, while postpaid customers will receive compensation through bill adjustments.
Implementation timeline
NERC said DisCos must complete the compensation for February no later than 31 May 2026.
“Compensation for March 2026 shall be completed no later than 30 June 2026,” it said.
The commission said the distribution companies are prohibited from offsetting compensation credits against any existing customer debt.
“Customers must be clearly informed of the value and period of compensation received.
“NERC remains committed to protecting electricity consumers while ensuring the stability and sustainability of the electricity market.”
The commission said it will continue to monitor implementation and verify compliance by distribution companies to ensure all eligible customers receive the compensation due to them.
