NERC Approves Compensation for Band A Customers Affected by Power Outages

The Nigerian Electricity Regulatory Commission (NERC) has approved a special compensation package for eligible Band A electricity customers affected by poor power supply between February and March 2026.

The commission said the measure became necessary following significant generation shortfalls on the national grid, which prevented electricity distribution companies (DisCos) from meeting the minimum service levels promised to some Band A customers during the period.

In a public notice issued on Thursday, NERC explained that the supply disruptions were largely caused by inadequate gas supply to power plants and vandalism of critical gas and transmission infrastructure.

According to the commission, these challenges were beyond the direct control of electricity distribution companies.

To address the situation, NERC issued Directive No. NERC/2026/002 on the Special Compensation of Band A Customers Arising from Grid Generation Constraints.

Under the directive, Band A customers connected to feeders that recorded an average electricity supply of between 18 and 20 hours daily will continue to receive compensation under the existing regulatory framework.

However, customers on Band A feeders that received less than 18 hours of electricity supply per day during the affected period will benefit from a new compensation arrangement.

NERC stated that affected feeders will not be downgraded during the compensation period and eligible customers will receive compensation based on their category.

For non-maximum demand customers, compensation will amount to 20 per cent of the approved February 2026 energy cap applicable to their feeder.

Maximum demand customers will receive compensation equivalent to 20 per cent of the average energy billed per customer in February 2026.

The commission explained that prepaid customers will receive the compensation through electricity token credits, while postpaid customers will benefit through adjustments to their electricity bills.

NERC directed electricity distribution companies to complete compensation for February 2026 not later than May 31, while compensation for March 2026 must be concluded by June 30.

The regulator also introduced measures to protect consumers, directing that compensation credits must not be used to offset existing customer debts.

It further instructed DisCos to clearly inform beneficiaries of the value and period covered by the compensation.

NERC reaffirmed its commitment to protecting electricity consumers and ensuring stability within the power sector, adding that it will continue to monitor implementation and ensure compliance by all distribution companies.

Industry data released by the commission showed that despite persistent challenges in the power sector, electricity distribution companies generated about ₦600 billion in revenue during the first quarter of 2026.

Data from the Nigerian Independent System Operator also revealed that thermal power plants received less than half of the gas required for optimal operations during the period under review, resulting in reduced electricity generation and widespread load shedding across the country.

The commission expressed optimism that ongoing improvements in gas supply and power generation would help stabilise electricity supply in the coming months.