The Nigerian Electricity Regulatory Commission (NERC) has flagged rising financial pressure in the power sector, citing weak remittances from foreign customers and the persistent non-payment of electricity bills by Ajaokuta Steel Company Limited.

In its latest quarterly report, the commission said Ajaokuta Steel and its host community, classified as a special customer, failed to make any payment on electricity supplied in the fourth quarter of 2025. The unpaid bills include N1.26 billion owed to the Nigerian Bulk Electricity Trading Plc (NBET) and N130 million due to the Market Operator (MO).

The development extends a pattern seen in the previous quarter, when the entity also defaulted on over N1.1 billion in combined invoices.

NERC warned that the continued default is eroding market liquidity and weakening the financial position of generation and transmission companies. It added that the matter has been escalated to the federal government, signalling the need for urgent intervention.

The commission also highlighted poor remittance performance among international bilateral customers, who paid just $10.89 million out of the $20.44 million invoiced during the period, a remittance rate of 53.28 percent.

This leaves an outstanding $9.55 million owed to Nigerian generation companies, further tightening liquidity in a sector already grappling with funding constraints.

By contrast, domestic bilateral customers showed stronger compliance, remitting N3.51 billion out of N4.17 billion billed, representing 84.23 percent.

While some payments were made to clear outstanding obligations, NERC said overall remittance performance remains uneven, particularly among foreign off-takers.

The commission warned that without improved payment discipline and decisive government action on legacy debts such as Ajaokuta’s, the sector risks deeper financial strain and slower progress on market reforms.