By: Tijani Salako.
The Nigerian Electricity Regulatory Commission (NERC) has issued a revised Order directing successor electricity Distribution Companies (DisCos) to channel a portion of their earned Non-Administrative Operating Expenditure (Non-Admin OpEx) into dedicated capital projects aimed at improving electricity distribution infrastructure across the country.
The commission gave the directive in a statement issued on Wednesday, as obtained from the statement published on its handle, noting that the Order, which took effect from September 4, 2026, is designed to accelerate network upgrades, improve service reliability and ensure that available revenues are invested in critical infrastructure projects.
According to NERC, the revised Order followed a regulatory review of DisCos’ revenue utilisation for the 2025 market cycle. Meanwhile, under the new directive, all DisCos are required to establish and maintain dedicated Capital Expenditure (CapEx) Provision Accounts to finance approved network improvement projects.
The Commission stated that a portion of earned Non-Admin OpEx would be earmarked for network rehabilitation, reinforcement and expansion, with the allocation determined by each DisCo’s debt profile.
NERC further directed debt-free DisCos to remit 50 per cent of their earned Non-Admin OpEx into the CapEx Provision Account from August 2026, with the contribution increasing to 60 per cent from February 2027.
The Order also stipulates that every project funded through the CapEx Provision Account must receive prior approval from the Commission and be reported on a quarterly basis.
For DisCos with outstanding obligations to the Nigerian Bulk Electricity Trading Plc (NBET) and the Market Operator, NERC ordered them to complete debt reconciliation and submit Commission-approved repayment plans within 180 days.
The Commission said the revised Order is expected to strengthen distribution infrastructure, enhance service delivery to electricity consumers and improve financial discipline across Nigeria’s electricity distribution sector.
