International Customers’ Unpaid Bills Highlight Nigeria’s Power Sector Challenges
International customers have failed to pay a significant portion of their electricity bills, amounting to $19.84 million (N29.18 billion) from the total $34.71 million (N51 billion) billed to them between January and June 2025, according to an analysis of quarterly reports by the Nigerian Electricity Regulatory Commission (NERC). The data reveals that several countries, including Benin, Togo, and Niger, received electricity through their respective utility companies but only managed to pay 57% of their outstanding bills.
The affected utility companies include Société Beninoise d’Energie Electrique (SBEE), Compagnie Energie Electrique du Togo (CEET), and Société Nigerienne d’Électricité (NIGELEC). These entities were issued various monthly bills, with payments fluctuating throughout the six-month period.
Monthly Breakdown of Payments
- January: SBEE was billed $5.17 million, but only $3.64 million was paid.
- February: The bill rose to $5.52 million, yet only $0.81 million was paid.
- March: The bill increased to $6.49 million, with $1.43 million paid.
- April: A $6.34 million bill was issued, and $3.85 million was paid.
- May: The bill dropped to $5.68 million, with $2.88 million paid.
- June: A final bill of $5.51 million was issued, and only $2.26 million was paid.
Country-Specific Analysis
SBEE of Benin had the highest bill at $29.76 million, of which it paid $9.16 million. This means the country paid 69% of its bills, with payments made in January, April, May, and June. However, no payments were made for supplies received in February and March from Transcorp Generating Company in Ughelli and PARAS GenCo.
NIGELEC of Niger Republic was the second-largest customer, with a bill of $8.43 million, of which $5.62 million was paid, representing 77% of the total. The company paid its entire bill in January and February, and also covered part of the March bill. It managed to pay off all of April’s and May’s bills, but failed to pay anything in June.
CEET of Togo did not pay any of its $7.2 million bill. The company was billed $0.75 million in January, $1.02 million in February, $3.15 million in March, $0.98 million in April, $0.78 million in May, and $0.52 million in June. Despite these amounts, no payments were made.
Foreign Obligations Amid Low Domestic Supply
It is worth noting that NERC previously directed the grid operator to reduce supply to international customers to prioritize domestic needs. The directive highlighted that current supply management practices have caused significant hardship for Nigerians, as bilateral contracts with international customers take precedence over domestic supply.
This issue is not new. In 2019, the former Managing Director of the Transmission Company of Nigeria (TCN), Usman Mohammed, threatened to cut power to Togo and Niger due to unpaid debts. At the time, Niger owed $2 million, and Togo owed $14 million. These debts have since been reduced from $100 million a few years ago.
“We will disconnect them. Electricity is not charity,” Mohammed had said.
History of Debt Accumulation
International customers have a long history of late payments, leading to mounting debts. NERC reported that these customers owed over $12 million in unpaid debts at the end of 2023.
Analysts suggest that long-term solutions to Nigeria’s low electricity supply involve infrastructure improvements, increased generation capacity, and stricter enforcement of regulations within the power sector.
Nigeria currently supplies 300 megawatts of electricity to Togo, Benin, and Niger. However, despite this, the country’s installed electricity generation capacity ranges from 13,600 to 14,000 MW, but output has remained around 5,500 megawatts due to infrastructural limitations, leaving many households without reliable power.
Industry analysts argue that Nigeria should continue honoring its international obligations, even amid domestic challenges. Dr. Dauda Garuba, an industry analyst, stated, “Nigeria doesn’t need to stop doing energy business with its neighbours because of its inability to meet its obligation to the local market. Those are contracts meant to be fulfilled, too.”
Adetayo Adegbenle added, “Supply to neighboring states is primarily because of the international agreement we signed to build River Niger dam. Meanwhile, this is not a unique situation as these bills are easily charged to the Balance of Trade.”
Additional Struggles for Generating Companies
The lack of payment by international customers adds to the woes of generating companies (Gencos), which are already struggling with debts owed to them by the federal government and distribution companies (DisCos).
According to the existing subsidy structure, the federal government covers 50% of the generating cost of electricity, which has amounted to over a trillion naira in the first half of 2025. Gencos are also owed N4 trillion, including N2 trillion in legacy debt and another N2 trillion in subsidy payments for 2024.
The government has taken steps to address these issues, approving a N4 trillion bond to finance the debt. Special Adviser to the President on Energy, Olu Verheijen, emphasized the government’s focus on creating the right conditions for investment, including modernizing the grid and improving distribution.
Tony Elumelu, Chairman of Heirs Holdings and Transcorp Power, praised the government’s efforts, stating, “For the first time in years, we are seeing a credible and systematic effort by the government to tackle the root liquidity challenges in the power sector.” He added that the debt reduction plan signals a strategic reset of Nigeria’s electricity market, aiming to restore financial health, attract private capital, and improve reliability for homes and businesses.
