NERC Orders Discos To Compensate Band A Customers Over Power Shortfalls From Gas Supply Disruptions
The Nigerian Electricity Regulatory Commission (NERC) has directed electricity Distribution Companies (Discos) to compensate eligible Band ‘A’ customers who suffered service shortfalls between February and March this year due to generation constraints caused by inadequate gas supply and vandalism of critical infrastructure.
The regulator, in a public notice announcing Directive No. NERC/2026/002 on the Special ‘Compensation of Band A Customers Arising from Grid Generation Constraints’, said the measure was designed to address the impact of widespread generation shortfalls across the Nigerian Electricity Supply Industry (NESI) during the period.
NERC explained that the disruptions significantly affected the ability of Discos to meet the minimum service commitments guaranteed to customers under the Band ‘A’ classification, which is expected to receive at least 20 hours of electricity supply daily.
According to the commission, the generation shortfalls were largely triggered by inadequate gas supply to power plants as well as acts of vandalism targeting key gas and transmission infrastructure, circumstances it noted were beyond the direct control of the electricity distribution companies.
“The directive was introduced in recognition of the significant generation shortfalls experienced across the Nigerian Electricity Supply Industry (NESI) between February and March 2026, which affected the ability of Distribution Companies to meet the committed service levels for some Band A customers,” NERC stated.
Under the directive, customers on Band ‘A’ feeders that recorded an average daily supply of between 18 and 20 hours during the affected period will continue to be compensated under the existing framework contained in Addendum No. NERC/2024/003.
The commission said the compensation would apply to both Maximum Demand (MD) and Non-Maximum Demand (Non-MD) customers.
However, NERC introduced a special compensation package for Band ‘A’ feeders that received less than 18 hours of supply per day during the period under review. The regulator clarified that affected feeders would not be downgraded despite the service shortfalls recorded during the two months.
For non-maximum demand customers, compensation will be equivalent to 20 per cent of the approved February 2026 energy cap applicable to the affected feeder. Similarly, maximum demand customers will receive compensation equivalent to 20 per cent of the average energy billed per MD customer in February 2026.
NERC further directed that compensation for prepaid customers must be delivered through electricity token credits, while postpaid customers are to receive bill adjustments reflecting the approved compensation amounts.
To ensure prompt implementation, the commission fixed specific deadlines for the reimbursement exercise.
It stated that compensation relating to February 2026 should have been completed not later than May 31, while all compensation arising from March 2026 service shortfalls must be fully implemented by June 30, 2026.
The regulator also introduced measures aimed at protecting consumers and ensuring transparency in the compensation process.
According to NERC, Discos are prohibited from applying compensation credits to offset any outstanding debts owed by customers. It added that beneficiaries must be clearly informed of both the value of the compensation received and the specific period for which the reimbursement applies.
The commission stressed that the directive underscored its commitment to consumer protection while maintaining the operational stability and sustainability of the electricity market.
“NERC remains committed 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,” the notice stated.
Emmanuel Addeh
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