Nigeria’s electricity sector is once again at the centre of regional and domestic debate following the disclosure by the Nigerian Electricity Regulatory Commission (NERC) that neighbouring countries Togo, Niger Republic, and the Republic of Benin owe Nigeria a combined debt of ₦25 billion for electricity supplied. The revelation has reignited concerns over revenue leakages, cross-border power trade arrangements, and the long-standing financial crisis facing Nigeria’s power sector.
The disclosure, contained in a recent regulatory update by NERC, highlights the growing challenge of unpaid electricity exports even as Nigeria continues to struggle with power shortages, weak infrastructure, and liquidity constraints at home.
Nigeria’s Role as a Regional Power Supplier
Nigeria remains a major electricity supplier within the West African sub-region, exporting power to neighbouring countries under bilateral and multilateral agreements coordinated through the West African Power Pool. Through this framework, Nigeria supplies electricity to Togo, Niger, and Benin via interconnected transmission lines designed to promote regional integration and energy security.
Despite persistent power shortages domestically, successive Nigerian governments have maintained cross-border electricity supply as part of regional cooperation commitments. However, the accumulation of unpaid debts by beneficiary countries has raised questions about the sustainability of these arrangements.
According to NERC, the outstanding ₦25 billion debt reflects electricity already generated, transmitted, and delivered to the three countries but not fully paid for within agreed timelines.
Breakdown of the Debt
While NERC did not immediately provide a country-by-country breakdown in its summary statement, industry sources indicate that the debt has accumulated over several years due to delayed payments, currency challenges, and contractual enforcement issues.
Electricity exported to these countries is typically priced in foreign currency or naira-equivalent terms under power purchase agreements. However, fluctuations in exchange rates, fiscal pressures in the recipient countries, and weak enforcement mechanisms have contributed to the growing arrears.
NERC noted that the debt burden ultimately affects Nigeria’s electricity value chain, particularly generation companies (GenCos) and the Transmission Company of Nigeria (TCN), which rely on timely payments to sustain operations and maintain infrastructure.
Impact on Nigeria’s Power Sector
The revelation comes at a time when Nigeria’s power sector is grappling with severe financial stress. Many generation companies are owed hundreds of billions of naira by distribution companies, while transmission infrastructure requires massive investment to improve reliability.
Industry experts argue that unpaid international electricity debts worsen liquidity challenges across the sector. When exported electricity is not paid for, revenue shortfalls cascade down the value chain, limiting the ability of operators to invest in maintenance, capacity expansion, and service improvement.
Critics also question the rationale of continuing electricity exports while millions of Nigerians face erratic supply and frequent blackouts.
NERC’s Position and Regulatory Response
NERC emphasized that electricity exports must be financially sustainable and compliant with regulatory approvals. The commission stressed that export arrangements are subject to permits and conditions designed to protect Nigeria’s domestic electricity market.
According to the regulator, failure by international customers to meet payment obligations violates the terms of export agreements and undermines sector stability. NERC warned that it would not hesitate to review or suspend export permits where debts continue to accumulate without clear repayment plans.
The commission also reaffirmed its commitment to ensuring that electricity exported outside Nigeria does not compromise domestic supply or worsen shortages faced by Nigerian consumers.
Calls for Debt Recovery and Policy Review
The disclosure has sparked renewed calls from energy experts, lawmakers, and civil society groups for stronger enforcement of payment obligations and a comprehensive review of Nigeria’s electricity export policy.
Some analysts argue that Nigeria should prioritize domestic supply until power generation and transmission capacity significantly improve. Others advocate for stricter commercial terms, including advance payments or bank guarantees, before electricity is supplied across borders.
There are also calls for greater transparency around electricity export contracts, including volumes supplied, pricing structures, and payment performance by beneficiary countries.
Regional Diplomacy and Economic Realities
Supporters of regional power trade caution against abrupt policy shifts that could strain diplomatic relations within West Africa. They argue that electricity exports play a key role in regional stability, economic integration, and Nigeria’s leadership role in the sub-region.
However, they also acknowledge that regional cooperation must be built on mutual accountability. Persistent non-payment, they warn, risks undermining trust and could discourage future infrastructure investments aimed at strengthening regional power networks.
Economic challenges faced by Niger, Benin, and Togo—including limited fiscal space and currency pressures—are often cited as contributing factors to delayed payments. Nonetheless, Nigerian officials insist that these challenges cannot justify prolonged debt accumulation.
Domestic Reaction and Public Sentiment
The news has generated strong reactions among Nigerians, many of whom express frustration that electricity is being exported while domestic consumers endure unreliable supply and rising tariffs.
Public commentators argue that Nigerian households and businesses effectively bear the cost of unpaid exports through poor service delivery and higher electricity bills. On social media and public forums, calls have intensified for government intervention to recover outstanding debts or halt exports until payments are settled.
Some stakeholders have also urged the federal government to channel recovered funds into upgrading transmission infrastructure and supporting renewable energy development.
Legal and Contractual Implications
Legal experts note that electricity export agreements are governed by contracts that include dispute resolution mechanisms. Nigeria, they argue, has the option of invoking these provisions to recover outstanding payments or renegotiate terms.
Failure to enforce contracts, analysts warn, could set a precedent that weakens Nigeria’s bargaining position in future regional trade agreements.
NERC’s disclosure is seen as a first step toward greater accountability, but experts insist that sustained political and regulatory action will be required to resolve the issue.
What Happens Next
Attention is now focused on how the Nigerian government and NERC will pursue debt recovery. Possible options include diplomatic engagement, renegotiation of payment terms, restructuring of outstanding debts, or suspension of electricity supply to defaulting countries.
Industry observers expect discussions involving the Ministry of Power, the Ministry of Foreign Affairs, and regional energy bodies in the coming weeks.
For the power sector, the outcome will be closely watched as a test of Nigeria’s resolve to enforce commercial discipline and protect its national interest.
Conclusion
The revelation that Togo, Niger, and Benin owe Nigeria ₦25 billion for electricity supplied underscores the deep structural and financial challenges confronting Nigeria’s power sector. While regional electricity trade remains an important pillar of West African cooperation, unpaid debts threaten the sustainability of these arrangements and exacerbate domestic power challenges.
As pressure mounts on authorities to act, the situation presents an opportunity for Nigeria to recalibrate its electricity export policy, strengthen enforcement mechanisms, and ensure that regional leadership does not come at the expense of domestic stability. The coming months will determine whether the debt issue becomes a turning point for reform—or another unresolved burden on Nigeria’s fragile power sector.
