Technical losses measure physical energy dissipation in the distribution network. Commercial losses concern delivered electricity that is not accurately captured for billing, while collection losses measure the portion of billed amounts that distribution companies do not collect. ATC&C loss combines performance across these stages rather than reporting a single type of failure.
The three loss categories at a glance
Nigeria’s electricity distribution loss data follows the path from delivered energy to billed energy and, finally, collected revenue.
Technical losses occur within electrical equipment and networks. They include energy dissipated through transformers and power lines, as well as resistance-related losses in cables and windings. These are physical network inefficiencies, although the supplied explanation cautions that estimates can depend on network conditions and assumptions used by distribution companies.
Commercial losses occur when electricity has been delivered but is not accurately captured for billing. Cited causes include theft, direct connections, meter tampering, defective meters, meter bypass, and metering or billing inaccuracies. Unlike technical losses, these are associated with accounting for consumption rather than the physical dissipation of energy.
Collection losses arise after bills have been issued. They represent the shortfall when a distribution company collects less than the full amount billed to customers. An unpaid bill is therefore a collection problem, not evidence that the corresponding electricity disappeared from the network.
How ATC&C loss connects billing and collection efficiency
Aggregate technical, commercial, and collection loss—commonly written as ATC&C loss—summarizes performance across both the energy-to-bill and bill-to-payment stages. One supplied explanatory source expresses it as:
ATC&C loss = 1 − (billing efficiency × collection efficiency)
Billing efficiency reflects how much delivered energy is accounted for through billing. A lower result indicates a larger combined technical-and-commercial gap between the energy delivered and the energy captured in bills. Collection efficiency measures how much of the issued bill value is actually collected.
The efficiencies are multiplied because the stages occur sequentially. Consequently, their associated loss percentages should not simply be added to calculate aggregate ATC&C loss. The metric is useful for showing how much delivered electricity ultimately translates into collected revenue, but it does not diagnose the precise cause. A high aggregate loss could reflect network inefficiency, unrecorded consumption, billing problems, weak payment collection, or a combination of these factors.
Reading the Q2 2025 Nigeria figures
A supplied news report quoting NERC data provides a practical example for Q2 2025. It reported energy offtake valued at ₦909.59 billion and energy billed at ₦742.34 billion, producing billing efficiency of 81.61%. Distribution companies reportedly collected ₦564.71 billion from the ₦742.34 billion billed, corresponding to collection efficiency of 76.07%.
Applying the cited formulation to those reported efficiencies gives a weighted-average ATC&C loss of approximately 37.92%. The report compared that result with a regulatory target of 20.54%, a difference of 17.38 percentage points.
The cited breakdown identifies 18.39% as the combined technical-and-commercial loss component and 23.93% as the collection-loss component. These percentages represent losses at successive stages, so adding them would not be the correct way to reproduce the 37.92% aggregate result.
Crucially, the 18.39% figure does not reveal separate technical and commercial loss rates. It cannot show how much arose from physical network effects and how much resulted from theft, metering, or billing issues. A separate allocation would require supporting data not present in the cited reporting. The figures should also be attributed to the supplied news account because the underlying NERC report was not included in the research package.
Conclusion
When interpreting distribution data, first identify the stage being measured: physical delivery, billing, or payment collection. Next, distinguish billing efficiency from collection efficiency and check whether technical and commercial losses are published separately or only as a combined figure. Do not divide a combined percentage between network and commercial causes without supporting evidence, and note that technical-loss estimates may depend on network conditions and modelling assumptions.
For every new dataset, apply this checklist to its definitions and reporting notes: identify the relevant stage, confirm the calculation method, preserve combined categories, and compare actual performance with any stated target on the same basis.
Frequently asked questions
Is ATC&C loss the same as electricity physically lost from the network?
No. Physical network dissipation is only the technical category. ATC&C loss also incorporates commercial gaps in capturing delivered electricity for billing and collection shortfalls after bills have been issued.
Can the Q2 2025 combined figure show separate technical and commercial loss rates?
No. The cited Q2 2025 reporting provides an 18.39% combined technical-and-commercial component, not an individual percentage for each category. Separating them would require additional supporting data.
Disclosures and limitations
- This article was prepared with AI assistance from the supplied research package. Material definitions come from secondary or contributor-authored explanatory sources, while the Q2 2025 figures come from a supplied news report quoting NERC data; the underlying NERC report was not included.
Related reading
- Data & Reports for Nigeria’s Electricity Sector
- How to Reconcile Conflicting Electricity Access Figures for Nigeria
- What Nigerian Electricity Consumers Should Know About Solar Panels’ Dependence on Sunlight