The Nigerian Electricity Regulatory Commission (NERC) has approved a special compensation package for eligible Band A electricity customers affected by poor power supply arising from generation constraints on the national grid between February and March 2026.
In a public notice issued on its social media handles on Thursday, the commission said the directive was introduced following significant generation shortfalls across the Nigerian Electricity Supply Industry, which prevented electricity distribution companies from delivering the minimum service levels guaranteed to some Band A customers in the first quarter of the year.
NERC stated that it had issued Directive No. NERC/2026/002 on the Special Compensation of Band A Customers Arising from Grid Generation Constraints to address the situation.
According to the commission, the directive was introduced “in recognition of the significant generation shortfalls experienced across the Nigerian Electricity Supply Industry between February and March 2026, which affected the ability of distribution companies to meet the committed service levels for some Band A customers”.
It explained that the supply disruptions were largely caused by factors beyond the control of electricity distribution companies. “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,” the commission stated.
Under the directive, the compensation scheme covers the period from February 2026 to March 2026.
NERC said customers connected to Band A feeders that recorded an average daily supply of between 18 and 20 hours during the period would continue to be compensated under the existing framework.
It stated, “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 and Non-Maximum Demand customers.”
The regulator also introduced special compensation for Band A customers connected to feeders that received less than 18 hours of electricity supply daily during the affected period.
According to the directive, affected Band A feeders will not be downgraded during the covered period. It added that eligible customers would receive compensation based on their customer category. For non-maximum demand customers, NERC said they would receive “compensation equivalent to 20 per cent of the approved February 2026 energy cap applicable to the affected feeder”.
Similarly, the commission stated that maximum demand customers would receive compensation equivalent to 20 per cent of the average energy billed per MD customer in February 2026.
The regulator explained that prepaid customers would receive compensation through token credits, while postpaid customers would receive compensation through adjustments to their electricity bills.
NERC further directed electricity distribution companies to complete compensation for February 2026 no later than May 31, 2026, while compensation for March 2026 must be concluded by June 30, 2026.
The commission also introduced measures to protect consumers and ensure that beneficiaries receive the full value of the compensation. It stated that “distribution companies are prohibited from offsetting compensation credits against any existing customer debt”, adding that “customers must be clearly informed of the value and period of compensation received”.
Reaffirming its commitment to consumer protection and market stability, NERC said it remains committed to protecting electricity consumers while ensuring the stability and sustainability of the electricity market.
The commission added that it will continue to monitor implementation and verify compliance by distribution companies to ensure all eligible customers receive the compensation due to them.
The DisCos collected about N600bn from consumers in the first quarter of 2026, according to the latest industry data released by the regulator, despite persistent challenges in the power sector.
During the quarter, the Nigerian Independent System Operator provided operational data illustrating the scale of the shortfall, noting that thermal power plants require an estimated 1,629.75 million standard cubic feet of gas per day to operate at optimal capacity, but as of February 23, 2026, actual supply stood at about 692.00 mmscf per day, representing less than 43 per cent of the required volume.
As gas supply declined in the first quarter, several power plants shut down while the Transmission Company of Nigeria engaged in load shedding, rationing the limited energy available among the DisCos.
On their various platforms, the distribution companies have repeatedly appealed to customers, attributing the outages to gas shortages.
