Nigeria’s electricity regulator has directed the Transmission Company of Nigeria to cut regional transmission losses to no more than 6.5 per cent by the end of 2026, under a new order aimed at improving transparency, accountability and grid efficiency.

The Nigerian Electricity Regulatory Commission issued Order No. NERC/2026/026 on April 8, which takes effect on Monday. Backed by the Electricity Act 2023, the directive introduces a formal framework for reporting transmission loss factors across regions operated by TCN.

Data cited from the Nigerian Independent System Operator showed the national average transmission loss factor stood at 8.71 per cent in 2024 before declining to 7.24 per cent in 2025, both above the seven per cent benchmark approved under the Multi-Year Tariff Order.

Recent updates from the system operator indicate the loss factor has improved further to about 7.05 per cent following targeted operational measures.

Under the order, NISO is required to install smart meters at all regional interconnection points by December 2026 to enable accurate measurement of energy flows. It must also track electricity passing through transmission transformers and submit quarterly regional reports to the regulator.

TCN has been given until July 2026 to submit a detailed plan outlining how it will meet the loss targets. By December 31, 2026, no transmission region is expected to exceed the stricter 6.5 per cent cap.

The directive comes amid concerns over the financial impact of transmission inefficiencies. NISO Managing Director Abdu Mohammed Bello recently said the sector had been losing between five billion and eight billion naira monthly due to high losses when operations began, with the loss factor previously nearing 10 per cent.

He noted that improved monitoring and coordination had begun to reduce losses, but further cuts to between five and six per cent remain necessary to meet regulatory targets.

The latest move builds on wider reforms in the power sector. The unbundling of TCN under the Electricity Act led to the creation of NISO in 2025, separating system operations from transmission infrastructure responsibilities.

Despite improvements, challenges remain. Nigeria’s grid has recorded several collapses in early 2026, continuing a pattern seen in previous years. While peak transmission reached a record 5,801.84 megawatts in March 2025, supply to consumers remains limited by constraints across generation, transmission and distribution.

The new order is expected to strengthen accountability by shifting focus from national averages to region-specific performance metrics. Industry observers say it signals a tougher regulatory stance following years of underperformance relative to approved benchmarks.

TCN has expanded infrastructure in recent years, commissioning new transformers and upgrading key transmission lines with support from development partners including the African Development Bank.

Stakeholders say meeting the 6.5 per cent target will require sustained investment in modern systems such as supervisory control and data acquisition technology, alongside improved operational discipline.