NERC Issues New Guidelines to DisCos on Electricity Bill Collection, Cash Payment

• The Nigerian Electricity Regulatory Commission (NERC) has issued new guidelines to DisCos on cash and digital bill collection
• The commission said the new guideline prohibits unlicensed third-party agents from collecting bills on behalf of any DisCo
• It disclosed that third-party bill collection agents must be licensed by the Central Bank of Nigeria and NIBSS, with verifiable tax compliance

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

The Nigerian Electricity Regulatory Commission (NERC) has issued fresh guidelines, mandating electriciting distribution companies (DisCos) to utilise a digital, transparent, and accountable framework for electricity revenue collection.

The new framework was released on Wednesday, May 28, 2025, and was signed by the NERC chairman, Sanusi Garba.

NERC bans cash collection by DisCos

The new directive takes effect immediately and is based on the commission’s powers as enshrined in Section 226 of the Electricity Act 2023.

They are targeted at electricity distribution companies (DisCos) operating in states or places that have no established electricity markets.

According to the new directive, the move aligns with the Nigerian government’s plan for a cashless economy and aims to tighten controls over electricity revenue inflows into the Nigerian Electricity Supply Industry (NESI).

NERC bars DisCos from using unlicensed agents

The new guideline prohibits DisCos from engaging unlicensed agents for bill collections.

It stated that only third-party collection service providers with valid Central Bank of Nigeria (CBN) licenses, verified integration with the Nigeria Inter-Bank Settlement System (NIBSS), and tax compliance will be allowed to operate.

The commission stated that it issued the guideline to boost revenue collection in NESI, ensure the efficiency of revenue collection contracts, and reduce the risk of revenue losses from DisCos’ engagement of third-party agents.

Electricity bill: NERC introduces commission payments

NERC also introduced a limit on commission rates across all payment platforms.

It disclosed that USSD transactions below N5,000 will attract an N20 commission, while rural agents may charge about 3.25% per transaction, subject to the N2,000 cap.

To protect industrial and commercial customers, NERC said maximum demand customers will continue to enjoy commission-zero charges on their bill payments.

The policy is based on the commission’s prior order, which eliminated cash payments for large-scale electricity users.

The new guideline now wants to institutionalise digital payments across all platforms, including USSD codes, PoS terminals, vending kiosks, mobile wallets, and Internet banking channels.

NERC said the order applies to all CSPs and DisCos, stating that no CSP shall be engaged by a DisCo without a CBN license and that all third-party collection service agreements and contracts entered into with any distribution company under NERC’s oversight are subject to its approval and registration before transaction commencement.

Band A users on 18 feeders to be downgraded

Earlier, NERC ordered eight electricity distribution firms to downgrade 18 electricity feeders in the Band A feeders to lower bands over their inability to supply a minimum of 20 hours of power to the affected customers.

The commission also ordered the DisCos to compensate Band A customers in 213 feeders.

The order was contained in the May 2025 Supplementary Order to the Multi-Year Tariff Order (MYTO)

Lagos launches Nigeria's first independent electricity market

Legit.ng earlier reported that as the first subnational entity in the nation and one of the few in Africa to create a fully regulated, independent electricity market, Lagos State is poised to make history.

The state government was integrating all of its power-related policies into a single, comprehensive electricity policy as part of a reform to modernise its energy ecosystem.

This strategy aimed to improve energy availability, attract investment, and accelerate growth.

Proofreading by Kola Muhammed, copy editor at Legit.ng.

Source: Legit.ng