The Nigerian Electricity Regulatory Commission (NERC) has issued a directive for the offer of special compensation to Band A Customers following widespread power outages that occurred in recent months.
In a statement released on Wednesday, the Commission said the decision contained in Directive No. NERC/2026/002, was informed by the significant power generation shortages 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 Commission said the blackouts were largely caused by shortage of gas supply to thermal power plants and vandalism of critical gas and electricity transmission infrastructure.
“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.
Due to these challenges, the Commission determined that premium-paying customers should receive relief as their guaranteed service levels were not met
Key Provisions of the Directive
The national electricity regulator said the compensation scheme applies to the period from February to March 2026.
It stressed that the amount of compensation depends on the severity of the disruption and the type of customer. It said the compensation shall apply to both Maximum Demand (MD) and Non-Maximum Demand (Non-MD) customers.
According to the directive, if a Band A feeder recorded less than 18 hours of average daily supply, affected customers will receive a special compensation equal to 20% of the approved February 2026 energy cap applicable to the affected feeder. Importantly, these feeders will not be downgraded to a lower band during this period, it stated.
For customers on Band A feeders that received between 18 and 20 hours of supply, their compensation will be based on the existing rules established in Addendum No. NERC/2024/003, not the new special 20% rate.
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It clarified that for non-MD customers (typical residential users), 20% of the approved February 2026 energy cap for their feeder shall be given as compensation, while for MD Customers (large users like industries, banks, hotels), compensation is 20% of the average energy billed per MD customer in February 2026.
How Customers Will Receive Their Compensation
The Commission stated that customers with prepaid meters will receive compensation through token credits, while postpaid customers will receive compensation through bill adjustments.
NERC set firm deadlines for DisCos to implement the compensation. It said that for February 2026 shortfalls, compensation must be completed no later than May 31, 2026, while that of March 2026 shortfalls must be completed no later than June 30, 2026.
Customer Protection Measures
To ensure customers receive the full benefit, NERC said DisCos are prohibited from offsetting these compensation credits against any existing debts a customer may owe. Furthermore, DisCos are required to clearly inform customers of the value and period for which they are receiving compensation.
NERC reaffirmed its commitment to protecting electricity consumers while ensuring the stability and sustainability of the electricity market.
“The Commission will continue to monitor implementation and verify compliance by Distribution Companies to ensure all eligible customers receive the compensation due to them,” it added.
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. He can be reached via @VICTOREZEJA on X