The Nigerian Electricity Regulatory Commission (NERC) has approved a special compensation package for eligible Band A electricity customers affected by poor power supply caused by generation constraints on the national grid between February and March 2026.
In a public notice issued on Thursday, the commission said the directive became necessary following significant generation shortfalls across the Nigerian Electricity Supply Industry (NESI), which prevented electricity distribution companies (DisCos) from meeting the minimum service levels guaranteed to some Band A customers during the first quarter of the year.
NERC said it had issued Directive No. NERC/2026/002 on the Special Compensation of Band A Customers Arising from Grid Generation Constraints to address the situation.
According to the regulator, the power shortages were largely driven by inadequate gas supply and vandalism of critical gas and transmission infrastructure, factors beyond the direct operational control of the distribution companies.
Under the directive, customers connected to Band A feeders that recorded an average daily electricity supply of between 18 and 20 hours during the affected period will continue to receive compensation under the existing framework established in Addendum No. NERC/2024/003.
However, the commission introduced additional compensation measures for Band A customers connected to feeders that received less than 18 hours of electricity supply daily between February and March 2026.
NERC clarified that affected Band A feeders would not be downgraded during the period covered by the directive.
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. Maximum demand customers will receive compensation equivalent to 20 per cent of the average energy billed per customer in February 2026.
The commission said prepaid customers would receive compensation through token credits, while postpaid customers would benefit from bill adjustments.
It directed all electricity distribution companies to complete compensation payments for February 2026 by May 31, 2026, and conclude compensation for March 2026 by June 30, 2026.
To protect consumers, NERC barred DisCos from deducting compensation credits to offset existing customer debts and mandated them to clearly communicate the value and period of compensation received by beneficiaries.
The regulator reiterated its commitment to consumer protection and market stability, assuring customers that it would closely monitor implementation and verify compliance to ensure all eligible consumers receive their entitlements.
The compensation directive comes amid persistent challenges in Nigeria’s power sector, particularly declining gas supply to thermal power plants. Data from the Nigerian Independent System Operator showed that thermal plants required about 1,629.75 million standard cubic feet of gas per day to operate optimally, but only about 692 million standard cubic feet per day was available as of February 23, 2026.
The shortfall forced several power plants to shut down, prompting the Transmission Company of Nigeria to ration available electricity among distribution companies through load shedding.
Despite these challenges, recent reports from some electricity consumers indicate a gradual improvement in power supply across parts of the country.
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