NERC Approves Compensation for Eligible Band A Electricity Customers

By Ediri Ejoh

The Nigerian Electricity Regulatory Commission (NERC) has announced a special compensation scheme for eligible ‘Band A’ customers who were affected by grid generation constraints.

In a statement released yesterday, NERC explained that the new framework aims to reduce the financial impact on consumers who experience prolonged outages despite holding a premium service status.

The statement read: “NERC hereby notifies electricity consumers and stakeholders of the issuance of Directive No. NERC/2026/002 on the Special Compensation of Band A Customers Arising from Grid Generation Constraints.”

“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.”

“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.”

NERC highlighted key provisions of the directive, including:

• Coverage Period: The compensation scheme applies to the period covering February 2026 to March 2026.
• Compensation for Feeders with 18–20 Hours Supply: 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.
• Special Compensation for Feeders with Less Than 18 Hours Supply: Affected Band A feeders will not be downgraded during the covered period; eligible customers will receive special compensation. For Non‑MD customers, compensation will equal 20 percent of the approved February 2026 energy cap applicable to the affected feeder. For MD customers, compensation will equal 20 percent of the average energy billed per MD customer in February 2026.

The mode of compensation will be:

• Prepaid customers will receive compensation through token credits.
• Postpaid customers will receive compensation through bill adjustments.

Implementation timelines are as follows: compensation for February 2026 will be completed no later than 31 May 2026, and compensation for March 2026 will be completed no later than 30 June 2026. DisCos are prohibited from offsetting compensation credits against any existing customer debt, and customers must be clearly informed of the value and period of compensation received.

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