NERC approves compensation for Band A electricity customers affected by supply shortfall

The Nigerian Electricity Regulatory Commission (NERC) has approved a special compensation scheme for eligible Band A electricity customers who were affected by grid generation constraints that occurred between February and March 2026.

In a public notice issued through Directive No. NERC/2026/002 titled “Special Compensation of Band A Customers Arising from Grid Generation Constraints,” the Commission explained that the measure was introduced in response to significant generation shortfalls within the Nigerian Electricity Supply Industry (NESI). These shortfalls impaired the ability of Distribution Companies (DisCos) to meet their committed service levels.

NERC stated that the shortfalls were largely caused by inadequate gas supply and vandalism of critical gas and transmission infrastructure—issues it described as beyond the direct operational control of DisCos.

According to the directive, the compensation covers the period from February 2026 to March 2026.

The Commission said that for Band A feeders that recorded an average daily supply of 18 to 20 hours, the existing compensation framework under Addendum No. NERC/2024/003 will apply to both Maximum Demand and Non‑Maximum Demand customers.

For feeders that received less than 18 hours of supply, affected Band A customers will receive special compensation, while the feeders will not be downgraded during the period under review.

Under the arrangement, Non‑Maximum Demand customers will receive compensation equal to 20 percent of the approved February 2026 energy cap for the affected feeder, whereas Maximum Demand customers will receive 20 percent of their average energy billed for February 2026.

NERC also outlined the mode of compensation, stating that prepaid customers will receive token credits, while postpaid customers will benefit through direct bill adjustments.

The Commission directed that compensation for February 2026 must be completed by 31 May 2026, and that for March 2026 it must be concluded by 30 June 2026.

It further warned that Distribution Companies are not allowed to offset compensation credits against existing customer debts, adding that customers must be properly informed of the value and period of compensation received.

NERC reaffirmed its commitment to protecting electricity consumers and ensuring stability in the electricity market, stating that it will continue to monitor implementation and enforce compliance by DisCos to guarantee that eligible customers receive due compensation.

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