Paying for Darkness: Tariff Bands, Estimated Billing and the Crisis of Accountability
By Adesegun Olutayo Osibanjo
Beyond Generation: A Systemic Failure
Nigeria’s Electricity crisis extends beyond inadequate generation. It reflects systemic failures across Gas supply, Generation, transmission, distribution, metering, billing and regulation. Households and businesses endure erratic supply while consumers, particularly those without functioning meters, receive bills they may be unable to verify against the electricity actually consumed.
An effective Electricity market must deliver dependable Power, transparent billing and enforceable Consumer protection. Revenue collection without commensurate service accountability is not efficiency.
The Electricity Act 2023 provides a framework for State Electricity markets following the Constitutional amendment. However, establishing State Electricity laws and Regulatory commissions does not automatically guarantee effective regulation. Operational capacity, clear jurisdictional arrangements, transparent performance reporting and enforcement are essential.
Gas, Generation and Transmission: Fix the Entire Value Chain
Nigeria possesses substantial natural Gas resources, yet production, processing, transportation infrastructure, payment challenges and competing demand constrain Gas-fired generation. These bottlenecks require coordinated investment, resolution of verified payment arrears and reliable Gas-delivery arrangements.
Installed Generation capacity must not be confused with available capacity or Electricity actually delivered. Existing facilities require appropriate maintenance and rehabilitation, while new generation must be matched with fuel availability and adequate transmission and distribution infrastructure.
Transmission investment must likewise respond to verified network constraints, loading, losses, evacuation limitations and growing demand. Without coordinated planning across the value chain, additional generation cannot guarantee improved electricity at consumers’ premises.
Mowe–Ibafo: An Economic Corridor in the Dark
The Mowe–Ibafo corridor along the Lagos–Ibadan Expressway supports residential communities, businesses, logistics, agriculture and other economic activities. Yet, affected communities are subjected to a two-days-on, two-days-off electricity supply schedule—an indefensible aberration in this day and age. Rather than resolve the infrastructure and operational failures responsible for inadequate supply, this arrangement normalises alternating periods of Electricity access and deprivation.
The situation becomes even more distressing when a line fault occurs, potentially leaving affected communities without electricity for at least five days. Businesses struggle to sustain production, refrigeration and trading, while households and enterprises incur additional costs for generators, fuel and alternative power. These recurring burdens undermine livelihoods, productivity, investment and economic development.
IBEDC deserves strong condemnation for sustaining this unacceptable schedule while continuing to impose substantial Electricity bills on Communities enduring prolonged periods without supply. Electricity distribution cannot be reduced to revenue collection while service delivery remains inadequate. Consumers should not bear the combined burden of unreliable supply, extended fault-related outages, alternative Energy costs and bills they cannot adequately verify.
The Transmission Company of Nigeria (TCN), relevant system operators, IBEDC and the Ogun State Government must urgently investigate the constraints affecting the corridor and publish a coordinated, time-bound improvement plan covering the necessary transmission, Substation and distribution investments.
IBEDC must disclose feeder-level supply and outage records, fault-response and restoration times, the basis for sustaining the schedule, and the measures required to end it. Businesses increasingly turning to private and alternative Electricity arrangements to remain operational may face higher Energy costs, while DisCos risk losing customers and demand. IBEDC should disclose the extent of these losses and explain what it will do to restore consumer confidence. This schedule must not become an accepted or permanent feature of Electricity distribution in modern Nigeria.
Tariff Bands: Different Prices, Unequal Realities
The service-based tariff framework specifies minimum daily supply commitments of 20 hours for Band A, 16 hours for Band B, 12 hours for Band C, eight hours for Band D and four hours for Band E. These are service obligations, not merely classifications for determining tariffs.
From my direct experience, the arrangement creates a strong commercial incentive for Distribution companies (DisCos) to prioritise higher-tariff customers, particularly those in Bands A and B, where reliable supply generates greater revenue. Meanwhile, Consumers in lower bands may remain exposed to erratic Electricity and estimated billing. This imbalance allows DisCos to maximise commercial returns without demonstrating equivalent service accountability across their customer base.
The answer is not to reduce supply to consumers enjoying better service, but to extend reliable Electricity to all customers and enforce the obligations attached to every tariff band.
The Minister’s Freezer Remark: Two Different Realities
On 16 September 2026, the Minister of Power, Joseph Olasunkanmi Tegbe, reportedly described Communities experiencing improved Electricity after prolonged deprivation. Speaking at the commissioning of a 3-megawatt Solar Hybrid Power Project at Yakubu Gowon University, Abuja, he said:
“Places that didn’t have light at all for three months are now having 18 hours light. Some areas called me to say, look, I should slow down, that everything in their freezer is freezing. That is what freezer is meant to do. Let it freeze the food that needs to be frozen.”
The remark captures the transformative value of reliable electricity. Yet it also exposes two different realities: while some communities reportedly enjoy up to 18 hours of daily supply, others continue to endure erratic electricity and bills they cannot independently verify.
Why should dependable electricity be a source of celebration for some Nigerians while others remain trapped in persistent shortages? Reliable power underpins refrigeration, production, commerce and household welfare. Consumers denied dependable supply often pay additionally for Generators, fuel and alternative power while continuing to pay their DisCos for inadequate service.
Estimated Billing: Paying Without Verification
Estimated billing compounds this injustice. Consumers without functioning meters cannot independently establish whether their bills reasonably reflect their consumption. Where supply is unreliable, opaque estimates become even more difficult to reconcile with the service received.
Consumers are left paying for darkness without the means to establish what was actually consumed.
DisCos must issue transparent, explainable bills consistent with applicable regulatory requirements. Consumers should understand the tariffs applied, the estimation methodology and the basis of their charges. Supply and outage records must be open to scrutiny, and unexplained discrepancies must trigger investigation rather than automatic acceptance of the operator’s figures.
Metering and Integrated Energy Accounting
Nigerian Electricity Regulatory Commission (NERC) figures for June 2026 reportedly put metered customers at 7,743,839 out of 12,589,486 active customers—approximately 61.51 per cent—leaving about 4.85 million unmetered. That is already an alarming deficit. However, if the official figures do not reflect verifiable conditions on the ground, they risk presenting a misleading picture of metering progress. NERC must urgently establish the actual position through rigorous field verification and an independent audit of its reported statistics.
The reported waiver regime, which exempts Band A and B customers from prepaid meter acquisition and installation fees while requiring consumers in other bands to pay, creates an inequitable system that may undermine mass metering. Consumers required to pay may understandably hesitate when others receive waivers, preferring to await equivalent relief. NERC must confront this policy inconsistency, end the discriminatory arrangement and extend equivalent relief across all customer bands.
Regulatory performance must be measured by verifiable progress towards universal metering, not headline statistics alone. NERC must reconcile its figures, publish the verified number of unmetered customers and establish a time-bound programme with clear responsibilities for funding, installation, replacement and maintenance.
Until universal metering is achieved, estimated billing must remain lawful, transparent, verifiable and open to regulatory scrutiny, with effective safeguards against arbitrary charges and consumer exploitation.
Beyond metering, Nigeria needs an auditable framework reconciling Electricity generated, Energy transmitted, Electricity received by distribution networks, Energy delivered to Customers, system losses, bills raised and revenue collected. DisCos must explain the relationship between energy available to their networks, customer supply, recorded or estimated consumption, billing and collections. Regulators must independently examine these records, account for legitimate technical losses and distinct measurement boundaries, investigate material discrepancies and enforce corrective action.
An Accountable Electricity Market Is Possible
Nigeria requires coordinated reform across the Electricity value chain: dependable Gas supply, available generation, targeted transmission and distribution investment, universal metering, enforceable service commitments, transparent billing and effective regulation.
NERC and competent State regulators must investigate persistent service failures, scrutinise billing practices and publish complaint-resolution and enforcement outcomes. Communities along and off the Lagos–Ibadan Expressway, particularly around Mowe and Ibafo, deserve urgent intervention rather than indefinite exposure to an indefensible supply schedule.
An Electricity market is not efficient merely because money changes hands. It is efficient when the Electricity delivered, the service promised, the bill raised and the revenue collected can be reconciled within a transparent and accountable system.
Until this principle governs Nigeria’s Electricity value chain, Consumers will continue to bear an unfair burden, and an effective and efficient Electric power sector will remain at risk of becoming a mirage.
About the Author
Adesegun Olutayo Adeolu Osibanjo, BEng, MBA, is an Energy & Climate Strategist, Author, and Systems Transformation Architect operating at the intersection of Energy Systems, Infrastructure, Economic Development and Institutional Reform. He is a COREN-Registered Engineer in the Federal Republic of Nigeria.
