Nigeria's electricity subsidy obligation eased in the second quarter of 2026, falling N37.06 billion to N321.26 billion from N358.32 billion in the preceding three months, according to the Nigerian Electricity Regulatory Commission's quarterly report. The decline amounts to a 10.34% quarter-on-quarter reduction in the fiscal burden carried by the Federal Government within the power value chain.
NERC attributed the drop mainly to a 3.40% contraction in electricity offtake by the distribution companies. The subsidy arises because the tariffs charged by DisCos sit below the actual cost of supplying power, forcing the government to absorb part of the gap between generation costs and the rates paid by consumers.
Across the 11 DisCos, generation company invoices totalled N647.72 billion during the quarter, while the final Distribution Retailer Obligation-adjusted invoice issued by the Nigerian Bulk Electricity Trading company came to N326.46 billion.
Monthly subsidy obligations were N108.40 billion in April, N112.93 billion in May and N99.93 billion in June.
By DisCo, GenCo invoices were recorded as follows:
- Abuja DisCo posted the highest figure at N106.67 billion, followed by Ikeja at N104.59 billion and Ibadan at N79.79 billion. - Eko recorded N75.39 billion, while Benin and Enugu recorded N55.03 billion and N52.52 billion respectively. - Port Harcourt, Kaduna, Kano and Jos recorded N44.73 billion, N39.64 billion, N39.97 billion and N32.42 billion respectively. - Yola posted the lowest total at N16.96 billion, with a final DRO-adjusted NBET invoice of N2.85 billion.
The N321.26 billion subsidy obligation accounted for 49.60% of total GenCo invoices, down 2.35 percentage points from 51.95% in the first quarter.
Remittance by the DisCos weakened slightly during the period. They paid N306.62 billion against the N326.46 billion NBET invoice, equivalent to a 93.92% remittance rate, compared with N312.48 billion remitted against N331.40 billion in the first quarter, or 94.29%.
