The Nigerian Electricity Regulatory Commission (NERC) has introduced a new regulatory framework designed to improve transparency and operational efficiency in the country’s power sector by tightening the monitoring of transmission losses and strengthening the rules governing mini‑grids. The Commission issued **Order No. NERC/2026/026**, which sets out a formal mechanism for measuring and reporting regional Transmission Loss Factors (TLF) across the transmission network operated by the Transmission Company of Nigeria (TCN).
Transmission Loss Factor measures the percentage of electricity generated that is lost as it moves through the grid due to technical factors such as resistance, heat, and system inefficiencies. NERC data show that the national average TLF fell from 8.71 per cent in 2024 to 7.24 per cent in 2025 but still remains above the 7 per cent benchmark set in the Multi Year Tariff Order (MYTO). The new Order, backed by the Electricity Act 2023, requires the Nigerian Independent System Operator (NISO) to install smart meters at all regional interconnection points by December 2026, perform accurate regional energy‑flow measurements, and submit quarterly TLF reports to NERC.
The Commission also directed TCN to submit an action plan by July 2026 for bringing TLF in each transmission region down to within the 7 per cent benchmark and to ensure that losses do not exceed 6.5 per cent by the end of 2026. NERC said the Order will strengthen accountability in transmission operations and help drive better grid performance through structured, data‑driven loss reporting.
In parallel, NERC has released the **Mini‑Grid Regulation 2026 (NERC‑R‑001‑2026)**, a comprehensive framework for the development, operation, and oversight of mini‑grids nationwide. The rules cover both isolated mini‑grids (up to 5 megawatts) and interconnected mini‑grids (up to 10 megawatts), applying to developers, distribution companies, and host communities. Mini‑grids below 100 kilowatts can be registered, while those above that threshold require a permit from NERC, processed within 30 business days.
The regulation requires annual reporting for mini‑grids under 1MW and quarterly reporting for those above 1MW, with NERC conducting ongoing monitoring and publishing sector data. By formalising standards, licensing timelines, and coordination requirements, the new rules aim to accelerate rural electrification, attract private investment, ensure fair tariffs and consumer protection, and promote smoother integration between mini‑grid operators and existing distribution networks.