The Nigerian Electricity Regulatory Commission (NERC) has issued Order No. NERC/2026/026 to curb electricity transmission losses and boost transparency on the national grid. The order, released on 8 April 2026 and taking effect on 13 April 2026, draws authority from the Electricity Act 2023, which allows NERC to set efficiency standards and enforce accountability.
Data from the Nigerian Independent System Operator (NISO) show the national average transmission loss factor fell from 8.71 per cent in 2024 to 7.24 per cent in 2025, yet it remains above the 7 per cent ceiling stipulated in the Multi‑Year Tariff Order. Under the new rules, NISO must install smart meters at every regional interconnection boundary by December 2026 to record precise energy flows. It will also track and document flows at transmission substations and deliver quarterly loss reports to NERC.
The Transmission Company of Nigeria (TCN) has been instructed to submit a detailed action plan by July 2026 and to keep regional losses below 6.5 per cent by December 2026. NERC said the initiative "is designed to improve transparency, strengthen monitoring systems and enhance operational efficiency across the grid." It added that "accurate reporting of transmission losses will support better planning, infrastructure management and fair pricing within Nigeria's electricity market."
NERC's decision to cap transmission losses at 6.5 per cent by the end of 2026 signals a decisive push to tighten operational standards in a sector long plagued by inefficiency. The regulator is setting a target that lies well below the 7 per cent benchmark of the Multi‑Year Tariff Order and the 7.24 per cent average recorded for 2025.
The move arrives after NISO reported a modest decline in loss factors from 8.71 per cent in 2024 to 7.24 per cent in 2025, indicating progress but also exposing a persistent gap. By mandating smart‑meter installations at all regional interconnection points and requiring quarterly loss reports, NERC is embedding data‑driven oversight that could curb the informal losses that have historically inflated electricity costs.
For households and small businesses, tighter loss controls could translate into lower tariffs and more reliable supply, as less energy is wasted before reaching end users. The burden of high electricity bills, a common grievance among Nigerians, may ease if the 6.5 per cent ceiling is achieved.
This regulatory tightening aligns with a broader pattern of reforms under the Electricity Act 2023, reflecting an ongoing effort to professionalise the power sector and restore consumer confidence after years of chronic under‑performance.
