The Nigerian Electricity Regulatory Commission’s (NERC’s) latest report on the electricity sector has indicated that Nigeria’s electricity transmission losses stood at N2.61 billion in the first quarter of 2026 as the Transmission Company of Nigeria (TCN) failed to meet the loss target set by it.
The latest first-quarter report recently published by the commission reflected that the Transmission Loss Factor (TLF), which is the proportion of the total energy generated by power plants that was either lost during transmission or utilised at transmission stations, increased above the regulatory benchmark, implying that a share of electricity generated never reached electricity distribution companies and other off-takers.
The power sector regulatory commission reported that in the quarter under review, there was an inverse relationship between the TLF and the efficiency of the transmission system, noting that a drop in the TLF indicates an improvement in transmission efficiency over a given period.
According to the data in the NERC’s report, the N2.61bn cost comprised N257.91mn due to TLF losses and N2.35bn in penalties payable to power generation companies but the figures excluded service level agreement penalties that TCN may have incurred due to under-delivery to distribution companies.
Despite the huge losses, the commission stated that the estimated loss was lower than the N3.13bn recorded in the corresponding quarter of 2025.
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A further analysis of the report’s data showed that the average Transmission Loss Factor recorded in Q1 this year stood at 7.96 per cent, exceeding the Multi-Year Tariff Order target of 7.00 per cent.
Specifically, the NERC reported that the average TLF in 2026/Q1 was 7.96 per cent and that a TLF of 7.96 per cent indicated that for every 100 megawatt-hours of energy injected into the grid, 7.96MWh of energy was undelivered to DisCos and international customers, due to losses in the transmission network or consumption at the transmission substations.
When compared to the preceding quarter’s performance, the commission reported that the TLF recorded in 2026/Q1 represented a 0.69 percentage point increase relative to the 7.27 per cent recorded in 2025/Q4.
The power sector regulator also noted that TCN also failed to meet the benchmark established under the tariff framework, stating that the 7.96 per cent TLF recorded in 2026/Q1 represents an underperformance of 0.96 percentage points relative to the MYTO target for 2026 (7.00 per cent).”
The commission lamented that exceeding the allowable transmission loss had direct financial implications since the excess losses cannot be recovered from electricity consumers.
It reported: “Exceeding the TLF target means the TSP will not be able to meet its full revenue requirement, as there is no provision to recover the revenue needed to cover the excess (inefficient) losses from customers.”
Based on the financial impact of the losses, the NERC disclosed that the TLF underperformance had additional costs for the TSP because it has to pay GenCos for the energy that is not billable to DisCos and other off-takers as the estimated cost of the 0.96pp TLF underperformance during the quarter is N2.61bn.
The report also revealed that the stability of the national grid deteriorated in Q1 2026 as fluctuations in system frequency increased, a development that could affect power quality, especially for industrial consumers.
While clarifying that frequency is a key indicator of power quality because heavy-duty industrial machinery is designed to operate within strict frequency limits, the NERC noted that the grid code prescribes a standard operating frequency of 50Hz, with a normal operating range of between 49.75Hz and 50.25Hz.
The report showed that the average lower daily system frequency fell to 49.11Hz in the first quarter of 2026, while the average upper daily system frequency rose to 50.72Hz, resulting in a frequency range of 1.61Hz, compared to a range of 1.27Hz recorded in the previous quarter.
The NERC further disclosed: “The 0.34Hz (26.77 per cent) increase in the average quarterly frequency range recorded in 2026/Q1 relative to 2025/Q4 indicates a slight decline in the stability of the National Grid’s frequency profile during 2026/Q1.”
Similarly, it reported persistent voltage fluctuations on the transmission network, cautioning that unstable voltage could damage electrical equipment and impose high costs on electricity consumers.
The commission stated that the grid code prescribed a nominal transmission voltage of 330kV, with an acceptable operating range of between 313.50kV and 346.50kV, noting, however, that the transmission network recorded an average lower operating voltage of 304.21kV and an average upper operating voltage of 349.88kV during the quarter, indicating that the system operated outside the prescribed limits at different times.
It warned that voltage fluctuations, including spikes, dips, flickers and brownouts, could damage industrial plants and other assets thereby compelling manufacturers to depend on alternative sources of electricity such as solar and gas technologies for their operations.
