Nigeria’s Power Sector Under Strain as Unpaid Electricity Bills Hit N6 Trillion

Power generation companies in Nigeria have warned that outstanding unpaid electricity bills have surged to around N6 trillion, creating severe financial pressure on the nation’s power industry. This backlog has made it difficult for plant operators to fund essential maintenance and secure fuel needed to keep electricity flowing.

The companies also pushed back against criticism claiming profiteering, stating that such claims overlook the sector’s ongoing liquidity challenges and the complexity of the electricity value chain.

Unpaid receivables largely stem from distributors and the bulk trader struggling to remit sufficient revenue back to generation firms, leaving them exposed and struggling to meet operational costs. Experts warn that without addressing these payment gaps, the country’s fragile electricity supply could deteriorate further, leading to reduced generation capacity and more disruptions for consumers and businesses.

The situation underscores the urgent need for structural reforms, improved revenue collection, and clearer strategies to strengthen payment systems and ensure the power sector’s long-term sustainability.