Power generation companies (GenCos) in Nigeria have lost an estimated ₦987.92 billion in five years due to the persistent electricity crisis arising from frequent collapse of the national grid and poor distribution infrastructure.
A recent report released by the Association of Power Generation Companies (APGC) explained that the figure represents the value of electricity that was available at the generation end but could not be delivered to consumers, primarily due to constraints in the national transmission grid and distribution networks.
The ₦987.92 loss was between 2020 and September 2025. The data showed that in 2020, about 3,742 megawatts (MW) worth ₦266.10 billion were stranded. In 2021, the power capacity loss reduced to 2,248 MW worth ₦159.85 billion. About ₦132.19 billion worth of power generated but not distributed was lost in 2022, while it rose to ₦162.06 billion in 2023 but dropped to ₦154.72 billion in 2024.
Earlier data showed that the GenCos recorded a loss of approximately ₦1.25 trillion between 2015 and 2019.
The data sourced from the National Control Centre and presented by the APGC Managing Director/Chief Executive Officer, Mrs Joy Ogaji, during the group’s 20th anniversary celebration revealed that Nigeria’s average generation capacity between January and September 2025 is 6,806.63 MW, while actual power utilised was 4,637.72 MW on average. This means 2,221.99 MW on average was stranded, indicating that about 32 per cent of the available electricity was wasted every month within the year.
Ogaji, who lamented about persisting inefficiency causing the losses, clarified that what generation companies are currently asking the Federal Government to pay is debt owed for energy supplied, which runs in trillions of naira.
“What the GenCos are asking the government to pay now doesn’t even include this. What we are owed is only for energy, not capacity,” she stated.
Highlighting the challenges in the power sector, Ogaji said it is still operating below its potential because of poor transmission and distribution infrastructure, which makes it impossible to off-take the total capacity produced by GenCos.
She further explained that the inability of GenCos to receive full payment for the total power generated monthly has contributed significantly to the liquidity crisis in the electricity market, making them unable to finance major maintenance and also invest in infrastructure upgrades for efficient power supply nationwide.
Ogaji warned that the current situation not only deters foreign investors but also affects the reliability of existing generation assets.
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The report presented by the APGC CEO corroborates earlier revelations by the Minister of Power, Adebayo Adelabu, that more than 10 gigawatts of generation capacity remain stranded nationwide as the people continue to experience chronic electricity shortages.
The accumulated losses have severe impacts on the sector and the wider economy. GenCos are caught in a severe liquidity crisis. They are owed over ₦2 trillion for power that has already been generated and consumed, but for which they have not been fully paid. A further ₦1.7 trillion funding gap was created by a 2024 tariff order, bringing the total debt and shortfall to about N4 trillion.
Cases of Low Invoice Payments
GenCos had, in mid-2024, reported that only about 10 per cent of their monthly invoices were being paid, crippling their ability to service loans, perform necessary maintenance, and procure spare parts.
Highlighting the importance of expanding power generation capacity, APGC had stated that a 1 per cent increase in power supply could grow Nigeria’s GDP by up to 3.94 per cent. The persistent stranding of capacity has therefore significantly held back industrial output and economic growth.
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Aside from the lack of formidable transmission infrastructure, industry experts also point to the metering crisis, which significantly accounts for the Aggregate Technical, Commercial and Collection (ATC&C) losses often recorded by DisCos.
Technical and commercial losses are billing losses incurred by a DisCo due to its inability to bill 100 per cent of energy delivered to customers, while collection losses are losses as a result of the DisCo’s inability to collect 100 per cent of the bills issued to customers.
The second quarter 2025 report of the Nigerian Electricity Regulatory Commission (NERC) revealed that the total energy offtake by all DisCos in the period was ₦909.59 billion, and the total energy billed was ₦742.34 billion, meaning that DisCos were unable to account for ₦167.25 billion worth of energy received.
The report indicated that the total revenue collected by all DisCos in Q2 2025 was ₦564.71 billion out of ₦742.34 billion billed to customers, meaning that about ₦177.63 billion was not collected.
The trillions of naira loss is an indicator of a deeper structural problem within Nigeria’s electricity value chain. While generation companies have increased their capacity, the infrastructure to deliver the power has not kept pace, resulting in massive financial losses and continued electricity scarcity for consumers.
Victor Ezeja is a passionate journalist, scholar and analyst of socioeconomic issues in Nigeria and Africa. He is skilled in energy reporting, business and economy, and holds a master's degree in mass communication.
