By Rekpene Bassey
When the Nigerian Electricity Regulatory Commission (NERC) was established in 2005 under the Electric Power Sector Reform (EPSR) Act, it was celebrated as a transformative milestone. It would dismantle the inefficiencies of the state-run electricity system and usher in an era of transparency, accountability, and private-sector-led innovation.
Two decades later, the sector is still gripped by darkness, not only of the electrical kind, but of moral, administrative, and operational dysfunction.
Despite being positioned as the industry’s watchdog, NERC has often found itself outmanoeuvred or complicit in the slow erosion of standards.
While regulatory blueprints exist in theory, enforcement mechanisms are hobbled by internal inertia, political interference, and industry capture. As a result, consumers face escalating tariffs without corresponding service improvements, while DisCos operate with impunity, shielded by a culture of opacity and weak oversight.
A key symptom of this decay is the persistent and rampant tampering with electricity meters. In most urban centres, it is not uncommon to find residential or commercial buildings with bypassed meters, fraudulent connections, or illegally reprogrammed units.
What makes this more galling is that many of these offences are committed with the tacit or active involvement of insiders within the DisCos technical staff who, for a fee, facilitate energy theft and then help conceal it.
Beyond its illegality, meter tampering directly undermines the sector’s commercial sustainability. Power consumed but not paid for becomes part of the “Aggregate Technical, Commercial and Collection (ATC&C) losses” that DisCos report, a burden they often transfer to law-abiding customers through inflated estimated billing. Thus, one man’s theft becomes another’s surcharge, feeding a vicious cycle of resentment and non-compliance.
Perhaps the most infamous enabler of this rot is the practice of estimated billing. For millions of Nigerians, electricity bills are not based on actual consumption but rather on opaque calculations, often bearing no resemblance to the hours of supply received. Consumers in low-income areas frequently report being charged more than those in affluent estates despite experiencing more extended power outages and using fewer appliances.
Estimated billing has evolved into a well-oiled racket. DisCo agents reportedly inflate usage readings based on arbitrary estimates, while internal staff manipulate data systems to justify these figures. The gains are shared through informal channels, often with the complicity of senior officials. Consumers, stripped of reliable means to verify usage, can bear the brunt or face disconnection. For many, it feels like legalized extortion under the guise of utility management.
NERC’s recent announcement to increase penalties for meter tampering appears to be a step toward reform. Under the new directive, consumers caught for the first time tampering with a single-phase meter face a fine of ₦100,000, while those with three-phase meters may be fined ₦200,000. Repeat offences attract even stiffer penalties. Yet, the absence of any corresponding policy action on estimated billing, arguably the sector’s most insidious plague, casts doubt on the depth of the commission’s resolve.
In truth, these penalties are grossly insufficient. Compared to the scale of revenue leakage, estimated at over ₦100bn annually, they resemble symbolic gestures rather than robust deterrents.
Moreover, in a country where impunity is often the norm, such fines do little to deter criminality unless accompanied by swift and specific enforcement. Without real prosecutions, sanctions remain hollow threats.
The core of the problem is that electricity theft and associated fraud are not treated with the gravity they deserve. These offences should be codified as economic sabotage and prosecuted as strict liability crimes.
Just as crude oil theft undermines national revenue, electricity theft compromises national productivity and investor confidence. Power is not just a service but a foundation for industrialization, job creation, and human development.
This inertia is further compounded by the federal government’s ambivalence toward deregulation. Although the sector has been technically unbundled, state subsidies, political patronage, and regulatory capture still distort the market.
Bailouts and financial interventions are routinely extended to DisCos, many of which have failed to meet even the most basic performance targets. This creates a moral hazard in which inefficiency is rewarded, and reform is optional.
Nigeria must undertake a comprehensive forensic audit of the electricity value chain to change course. Every layer, from generation companies to transmission and distribution, must be subject to independent scrutiny. This audit must cover technical operations, financial flows, procurement practices, and human resource structures. Only then can the true extent of corruption and mismanagement be uncovered and addressed with finality.
But audits alone are not enough. Enforcement must follow. Anti-graft agencies such as the EFCC, ICPC, and NSCDC must be empowered and mandated to investigate electricity-related crimes as a priority. Electricity fraud should no longer be treated as a civil or internal disciplinary issue; it is a public economic offence and must be prosecuted accordingly. A few high-profile convictions could reset industry norms.
Public engagement and consumer education must also be scaled up. The average Nigerian consumer remains unaware of his rights, the billing process, or the complaint resolution channels available. A literate, assertive, and mobilized public is one of the strongest checks against exploitation. Media, civil society, and advocacy groups have a role to play in closing the information gap and demanding accountability on behalf of the voiceless.
The mass deployment of prepaid meters must be pursued at the infrastructure level as a national emergency. The Nigerian Electricity Management Services Agency (NEMSA) must fast-track meter approvals. At the same time, the Meter Asset Providers (MAP) scheme must be purged of cartels that inflate costs and create artificial scarcity. Metering every home is not just a service upgrade but a pathway to transparency, equity, and economic efficiency.
Critically, the sector must be reoriented around service delivery, not rent-seeking. DisCos should be held to strict Key Performance Indicators (KPIs) tied to revenue collection, fault resolution time, metering penetration, and service hours. Those who fail should lose their licenses. If consumer confidence is to be restored, the days of mediocrity without consequence must end.
The stakes could not be higher. According to the World Bank, Nigeria loses an estimated $29 billion annually due to unreliable power. Businesses rely on expensive diesel generators to stay afloat, children study by candlelight, and hospitals perform surgeries under torchlight. This is not merely an inconvenience but a national emergency with far-reaching economic and human costs.
The dysfunction in the electricity sector is not born of inevitability. It results from deliberate neglect, institutional compromise, and a failure to confront entrenched interests. Countries with similar challenges, like India, Egypt, and even parts of East Africa, have made significant strides by embracing market liberalization, smart grid technology, and aggressive anti-theft measures. Nigeria must summon the courage to do the same.
Ultimately, reform will require more than policy tweaks. It demands political will, legal reform, citizen vigilance, and a new culture of accountability. The sleaze in the electricity sector is not just about stolen kilowatts; it is about stolen futures, dignity, and development opportunities. We must confront, uproot, and replace it with a system worthy of our national aspirations.
Rekpene Bassey is the President of the African Council on Narcotics (ACON) and an expert in security and drug prevention