The Nigerian Electricity Regulatory Commission (NERC) has approved a special compensation scheme for eligible Band A electricity customers affected by power supply disruptions caused by grid generation constraints between February and March 2026.
The Commission announced the measure in a public notice issued under Directive No. NERC/2026/002 on the Special Compensation of Band A Customers Arising from Grid Generation Constraints, saying the intervention was necessary to address the impact of significant generation shortfalls within the Nigerian Electricity Supply Industry (NESI).
According to NERC, the generation constraints hindered the ability of Distribution Companies (DisCos) to meet the minimum service commitments required for Band A customers, who are expected to receive at least 20 hours of electricity supply daily under the Service-Based Tariff framework.
The Commission attributed the generation shortfalls largely to inadequate gas supply to power generation companies and the vandalism of critical gas and transmission infrastructure across the country. It noted that these challenges were beyond the direct operational control of the affected DisCos.
Under the directive, Band A feeders that recorded an average daily electricity supply of between 18 and 20 hours during the affected period will continue to be compensated in line with the provisions of Addendum No. NERC/2024/003. The compensation applies to both Maximum Demand and Non-Maximum Demand customers connected to such feeders.
However, for Band A feeders that received less than 18 hours of average daily supply during the review period, NERC approved a special compensation package for affected customers. The Commission also directed that such feeders should not be downgraded from their Band A classification during the period under consideration.
Providing details of the compensation framework, NERC stated that Non-Maximum Demand customers will receive compensation equivalent to 20 per cent of the approved February 2026 energy cap for their respective feeders. Maximum Demand customers, on the other hand, will be compensated with 20 per cent of their average energy billed for February 2026.
The regulator further outlined the modalities for the compensation process. Prepaid customers are to receive compensation through energy token credits, while postpaid customers will benefit from direct adjustments to their electricity bills.
To ensure timely implementation, NERC directed all DisCos to complete compensation payments relating to February 2026 by May 31, 2026, while compensation for March 2026 must be fully settled on or before June 30, 2026.
The Commission stressed that Distribution Companies must not apply compensation credits to offset any outstanding customer debts. It also directed operators to clearly communicate to beneficiaries the value of the compensation received and the period for which it applies.
NERC said the directive forms part of its broader commitment to consumer protection and the promotion of fairness within the electricity market. The Commission reiterated that it will closely monitor compliance by DisCos and enforce the provisions of the directive to ensure that all eligible customers receive the compensation due to them.
The latest intervention comes amid ongoing efforts by stakeholders in the power sector to address persistent challenges affecting electricity generation, transmission and distribution, while maintaining service delivery standards for consumers across the country.
