Some international and domestic bilateral electricity customers continue to default on payments for power supplied by Nigeria’s grid-connected generation companies (GenCos), resulting in significant revenue shortfalls for the country’s power sector.
Recent data covering the second quarter of 2025 reveals that six international bilateral customers who purchase electricity from GenCos made partial payments totaling $9.015 million, against a total invoice of $17.54 million for services rendered during the quarter. This represents a remittance rate of 51.33% and leaves an outstanding balance of approximately $8.5 million.
Domestic bilateral customers also displayed a similar pattern of underpayment. These customers collectively paid ₦1.401 billion out of a total ₦2.79 billion invoiced for the same quarter, reflecting a remittance rate of 50.10%. While the remittance data was based on reconciled market settlements as of September 30, it underscores ongoing challenges in recovering due payments from both international and domestic power consumers operating outside the standard electricity distribution network.
Notably, one domestic bilateral customer made payments during the reviewed period to settle a portion of accumulated debt from previous quarters. A payment of ₦10.53 million was received toward outstanding invoices from prior quarters, marking a positive—albeit limited—effort in addressing historical debts.
Despite these partial recoveries, some customers remain completely non-compliant. A key concern highlighted in the report is the case of a major industrial off-taker, which failed to make any payment against an invoice of ₦1.27 billion issued for the quarter by the Nigerian Bulk Electricity Trading Plc (NBET). Additionally, the same customer did not settle ₦120 million in invoices from the Market Operator (MO), continuing a trend of consistent non-payment.
The persistence of such debts poses serious implications for the sustainability of the Nigerian electricity market. Unpaid invoices weaken the financial viability of GenCos, disrupt cash flow across the value chain, and undermine the confidence needed to attract further investment into the power sector. The situation is particularly concerning where long-standing debt profiles are involved, as this not only affects service delivery but also leads to an accumulation of financial risk within the market.
Efforts have been made to escalate these concerns to appropriate government authorities, especially in cases involving strategic national assets and public institutions. The relevant agencies have been urged to intervene in ensuring compliance with payment obligations and to develop mechanisms that enforce financial discipline among all market participants.
The challenges highlighted further emphasize the need for stronger regulatory enforcement, improved billing systems, and enhanced transparency in the contractual obligations of bilateral agreements. As Nigeria continues to pursue reforms in its electricity sector, addressing issues of revenue recovery and market discipline will be critical to achieving a reliable, efficient, and financially sustainable power supply system.
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