New directive targets inefficiencies costing billions monthly, mandates smart metering and stricter reporting across power network….
Nigerian Electricity Regulatory Commission has directed the Transmission Company of Nigeria to significantly reduce electricity transmission losses across the national grid, setting a firm target of 6.5 percent by December 31, 2026.
The order, issued on April 8, 2026, forms part of a broader push to improve efficiency, transparency, and accountability within Nigeria’s electricity transmission system. It introduces a new framework for tracking transmission loss factors (TLF) on a regional basis, aimed at tightening oversight of grid performance.
Under the directive, TCN is required to ensure that energy losses across all transmission regions within the Nigerian Electricity Supply Industry do not exceed the specified threshold, in line with the Multi-Year Tariff Order (MTYO) 2024.
The commission explained that transmission losses energy lost during the movement of electricity through power lines and transformers are partly unavoidable due to the physical nature of the grid. However, it stressed that poor maintenance, outdated infrastructure, and operational inefficiencies have contributed to losses above acceptable limits.
According to the regulator, transmission loss factor remains a critical benchmark for evaluating the health of the grid. It measures the gap between electricity sent into the system and what is ultimately delivered to consumers, making it a key indicator of efficiency and operational discipline.
Recent data shows the scale of the challenge. Reports from the Nigerian Independent System Operator indicate that average transmission losses stood at 8.71 percent in 2024 and 7.24 percent in 2025, both exceeding the regulator’s approved benchmark of 7 percent.
To address this, NERC has introduced a series of mandatory measures. These include the installation of smart meters at all regional boundary points to accurately track electricity flows, as well as detailed monitoring of energy movement through transformers at transmission substations.
The system operator has also been tasked with submitting quarterly reports on transmission losses, beginning mid-2026, using a standardized reporting format provided by the commission.
In addition, TCN must develop and submit a comprehensive corrective plan by July 31, 2026, outlining how it intends to bring high-loss regions within acceptable limits.
The commission made it clear that compliance is not optional, warning that failure to meet the new requirements could result in regulatory sanctions.
Meanwhile, the financial impact of inefficiencies in the transmission network remains substantial. According to the Managing Director of the Nigerian Independent System Operator, Abdu Bello, the country loses between ₦5 billion and ₦8 billion every month due to transmission-related issues.
He noted, however, that recent interventions are beginning to yield improvements in grid stability and loss reduction, signaling early progress in ongoing reform efforts.
With stricter monitoring, new technology requirements, and clear performance targets now in place, regulators are betting that Nigeria’s power transmission system can finally move toward greater efficiency and significantly reduce the financial drain caused by avoidable losses.
