Regulator introduces smart metering, stricter reporting rules, and mini-grid framework to boost transparency, efficiency, and rural electrification…..
The Nigerian Electricity Regulatory Commission (NERC) has introduced new regulations aimed at reducing electricity transmission losses and strengthening transparency across the national power grid.
The new directive, issued under Order No. NERC/2026/026, establishes an enhanced framework for the monitoring and reporting of Regional Transmission Loss Factors across Nigeria’s transmission network.
According to data from the Nigerian Independent System Operator (NISO), the national average transmission loss stood at 8.71% in 2024, before improving to 7.24% in 2025. Despite the decline, the figure remains above the 7% benchmark set under the Multi-Year Tariff Order (MYTO).
The order, signed on April 8, 2026, and effective from April 13, is backed by provisions of the Electricity Act 2023, which grants the regulator authority to enforce efficiency and accountability across the power sector.
In a statement posted on its official X account, NERC said the new framework places specific obligations on the Nigerian Independent System Operator (NISO) to improve accuracy in energy accounting and reporting.
Under the regulation, NISO is required to install smart meters at all regional interconnection boundary points by December 2026, enabling precise measurement of energy flows across the grid.
The system operator must also monitor energy flow at transmission substations, particularly at power transformers, and submit quarterly regional reports detailing transmission losses to the regulator.
NISO has further been directed to present an action plan by July 2026 outlining steps to bring transmission losses within approved limits, with a target of reducing losses to no more than 6.5% by December 2026.
“The objective of this order is to enhance transparency, improve monitoring, and ensure efficiency in the management of transmission losses across the grid,” the Commission said.
It added that accurate loss reporting remains critical to improving grid performance, strengthening planning capacity, and ensuring fair pricing within the electricity market.
NERC noted that the new framework will also enhance infrastructure management and reinforce regulatory oversight across the transmission network.
New mini-grid rules to expand rural electricity access
In a separate development, the Commission has also unveiled the Mini-Grid Regulations 2026 (NERC-R-001-2026), designed to streamline the development and operation of mini-grid systems across the country.
The framework seeks to expand electricity access in unserved and underserved communities while ensuring safety standards, fair tariff structures, and stronger investor protection.
It also strengthens coordination among mini-grid developers, operators, distribution companies, and host communities in line with the Electricity Act 2023.
The regulation applies to both isolated mini-grids, which operate independently of distribution companies, and interconnected systems linked to existing networks.
Under the new rules, isolated mini-grids may operate at capacities of up to 5MW, while interconnected systems may scale up to 10MW.
Mini-grid projects below 100KW are required to register with NERC, while those above that threshold must obtain a formal operating permit. The Commission said permits will be processed within 30 business days.
Operators will also be subject to new reporting obligations. Mini-grids below 1MW are expected to submit annual reports, while those above 1MW must file quarterly performance reports.
NERC added that it will continue to monitor operations across the sector and may publish industry data to improve transparency and accountability.
According to the regulator, the new mini-grid framework is designed to provide clarity, encourage private investment, and accelerate electrification efforts, particularly in rural communities.
“The Mini-Grid Regulations 2026 provide a clear and structured framework for operators, ensuring safety, accountability, and improved electricity access in underserved communities,” the Commission said.
It further stated that the reforms form part of broader efforts to strengthen Nigeria’s electricity market, improve regulatory efficiency, and support sustainable energy development nationwide.
