The Nigerian Electricity Regulatory Commission (NERC) has directed electricity Distribution Companies (DisCos) to compensate Band A customers affected by power supply shortfalls arising from generation constraints across the Nigerian Electricity Supply Industry (NESI) between February and March 2026.

The order, contained in Directive No. NERC/2026/002 on the Special Compensation of Band A Customers Arising from Grid Generation Constraints, followed significant generation shortages that prevented some DisCos from meeting the minimum service commitments required under the Band A tariff framework.

According to the Commission, the generation shortfalls were largely caused by inadequate gas supply and vandalism of critical gas and transmission infrastructure, factors it said were beyond the direct operational control of the DisCos.

The development comes amid ongoing concerns over the ability of the power sector to sustain service commitments under the Service-Based Tariff regime, particularly in the face of recurring gas supply constraints and attacks on critical electricity infrastructure.

NERC said the special compensation arrangement underscores its commitment to consumer protection while maintaining the stability and sustainability of the electricity market.

The Commission stated that the compensation scheme would cover the period between February and March 2026 and is intended to protect consumers who paid premium tariffs for higher levels of electricity supply but received lower service levels due to constraints within the power value chain.

Under the directive, Band A feeders that recorded an average daily supply of between 18 and 20 hours during the affected period would continue to be compensated in line with the existing compensation framework under Addendum No. NERC/2024/003.

The compensation will apply to both Maximum Demand (MD) and Non-Maximum Demand (Non-MD) customers connected to the affected feeders.

For Band A feeders that recorded less than 18 hours of daily electricity supply, the Commission said the affected feeders would not be downgraded during the covered period despite falling below the service threshold required for Band A classification. Instead, eligible customers are to receive special compensation.

“Eligible customers will receive special compensation as follows: Non-MD customers: compensation equivalent to 20 per cent of the approved February 2026 energy cap applicable to the affected feeder. MD customers: compensation equivalent to 20 per cent of the average energy billed per MD customer in February 2026,” NERC stated.

The Commission further directed that prepaid customers must receive the compensation through token credits, while postpaid customers would benefit through bill adjustments.

To ensure timely implementation, NERC mandated that compensation relating to February 2026 must be completed not later than May 31, 2026, while compensation for March 2026 must be concluded by June 30, 2026.

NERC also barred DisCos from using the compensation credits to offset customers’ outstanding debts.

It added that customers must be adequately informed about the value of compensation received and the specific period to which it relates.

The Commission said it would continue to monitor implementation of the directive and verify compliance by DisCos to ensure that all eligible customers receive the compensation due to them.