Federal Government owes TCN N217.68bn in tariff shortfall from 2015 to 2021, Auditor-General says; TCN's entire 2026 allocation is N160.12bn

The grid company is owed more by its own owner than the National Assembly gave it for the whole of 2026. The Auditor-General for the Federation's 2024 Annual Report on Non-compliance, Volume II, says on page 782 that the Transmission Company of Nigeria (TCN) had outstanding trade receivables of N446,700,224,437.49 at 31 December 2024, and that this "is made up of N217,677,332,987.00 (Two hundred and seventeen billion, six hundred ans seventy seven million, three hundred and thirty two thousand, nine hundred and eighty seven naira) being the Federal Government unpaid tariff shortfall owed to TCN between 2015 to 2021". The 2026 Appropriation Act, on pages 1452 and 1453, gives TCN a total allocation of N160,123,769,507.

Set side by side, the Federal Government's unpaid tariff shortfall to TCN is 1.36 times everything the 2026 Act appropriates to the company. The shortfall relates to years that ended at least five years ago. From 31 December 2021, the last day of the period the audit names, to 26 October 2026 is 1,760 days.

The rest of the receivable is owed by the distribution companies. The audit puts "N229,022,891,450.40 (Two hundred and twenty nine billion, twenty two million, eight hundred and ninety one thousand, four hundred and fifty naira, forty kobo) being DisCos unpaid portion of the market invoices as at 31st December, 2024". It adds that "the outstanding receivables of the Company remained uncollected as at the time of finalising this audit report." The finding is headed "Failure to collect electricity wheeling income for the use of government services" and covers 1 January to 31 December 2024.

Vero Record re-added the two parts. N217,677,332,987.00 plus N229,022,891,450.40 is N446,700,224,437.40, nine kobo less than the N446,700,224,437.49 the report prints as the total, both in the finding and in the auditors' evaluation. The difference is trivial in size, but it means the report's headline figure does not equal its own parts.

TCN's own reply, printed on page 783, uses a third number. Management wrote that part of the balance "includes the sum of N217,677,333,980.00 owned to TCN by the Federal Government in respect of tariff shortfall." That is N993.00 more than the auditors' N217,677,332,987.00. The report does not reconcile the two.

On the substance, the record supports TCN in part. Management told the auditors it "has written several correspondences to the Honourable Minister of Finance seeking recovery/liquidation of this amount, and copies of the relevant letters are attached for audit verification (see appendix 1)." It said that since the Electricity Act 2023 and the unbundling of TCN, market billing, collection, settlement and recovery functions "reside with the Market Operations arm of NISO", the Nigerian Independent System Operator, and asked for the observation to be reviewed. The letters to the Minister are not reproduced in the volume we read.

The auditors did not accept that. Their evaluation says "the response validates the total outstanding receivables of the Company as N446,700,224,437.49" and that "both portion of the receivables remained uncollected by the Company as at the time of evaluation of this response. Therefore, the issue is sustained". They asked the Managing Director to account to the Public Accounts Committees of the National Assembly for the full N446,700,224,437.49 and to "recover and remit to the Treasury" the same sum.

That recommendation has an odd shape for the larger part of the debt. N217,677,332,987.00 of it is, in the auditors' own words, owed by the Federal Government. A recovery from the Federal Government remitted to the Treasury would move money from the Treasury back to the Treasury. The report does not say which office should pay the shortfall, or whether the Federal Ministry of Finance has answered TCN.

The 2026 Act does not answer it either. TCN's page shows total personnel of 0, total overhead of 0 and total capital of N160,123,769,507. Of that, N147,782,843,937, or 92.29 per cent, is one line, ERGP10234165, "MULTILATERAL/BILATERAL TIED LOAN - NORTHERN CORRIDOE TRANSMISION PROJECT". Another N2,505,925,570 is compensation to communities affected by transmission projects. We searched the full text of the Act for "tariff shortfall" and "shortfall" and found no line for paying the shortfall to TCN; the one shortfall line in the Act concerns employer pension contributions. The Federal Ministry of Power's own page carries N17,500,000,000 for "intervention for competion of TCN uncompleted priority projects", which is for projects, not the debt.

The documents establish what the auditors recorded about TCN's receivables at the end of 2024, what TCN said in reply, and what the National Assembly appropriated to TCN for 2026. They do not establish that any money was misused, and no court has made any finding. They do not show how the N217,677,332,987.00 was calculated, whether the Federal Government accepts it, whether any of it has been paid since the audit, or whether it is settled through another channel, such as a promissory note or a market settlement, that does not appear as a TCN line in the Appropriation Act. The audit does not say how much of the DisCos portion is in dispute.

We invite a response from the Managing Director of the Transmission Company of Nigeria and from the Honourable Minister of Finance, in particular on the date and content of TCN's letters seeking recovery of the tariff shortfall, whether the Ministry accepts the N217,677,332,987.00 figure, and when and from which budget line it will be paid. Any response will be published in full.

What this rests on

AuGF 2024 Annual Report on Non-compliance Vol. II, Transmission Company of Nigeria, Abuja, report pp.782-783 (PDF pp.347-348), period 1 Jan to 31 Dec 2024, Issue 1. Parts: 217,677,332,987.00 + 229,022,891,450.40 = 446,700,224,437.40; printed total 446,700,224,437.49; difference 0.09. TCN management figure 217,677,333,980.00 minus audit figure 217,677,332,987.00 = 993.00. 2026 Appropriation Act pp.1452-1453, 0231020001 Transmission Company of Nigeria: personnel 0, overhead 0, capital 160,123,769,507 = total allocation (also on summary p.1407). Project lines on p.1453: 2,505,925,570 + 147,782,843,937 + 700,000,000 + 2,800,000,000 + 350,000,000 + 2,800,000,000 + 2,800,000,000 + 175,000,000 + 140,000,000 + 70,000,000 = 160,123,769,507 (matches). Ratios: 217,677,332,987.00 / 160,123,769,507 = 1.36; 147,782,843,937 / 160,123,769,507 = 92.29%. Days 31 Dec 2021 to 26 Oct 2026: 365 (2022) + 365 (2023) + 366 (2024) + 365 (2025) + 299 (1 Jan to 26 Oct 2026) = 1,760. Text search of the Act for 'SHORTFALL': one hit, '2.5% SHORTFALL FOR EMPLOYER PENSION CONTRIBUTION'. Federal Ministry of Power HQTRS, p.1415: ERGP10234203, 17,500,000,000.

What this does not establish

The documents do not establish misuse of funds or any crime; no court has ruled. They do not show how the tariff shortfall was computed, whether the Federal Government or the Ministry of Finance accepts it, whether any of it has been paid since the audit, or whether it is being settled outside the Appropriation Act (for example by promissory note or market settlement). TCN's letters to the Minister of Finance (its appendix 1) are not reproduced in the published volume. The N993.00 gap between the audit and TCN figures and the 9 kobo gap in the total are unexplained and may be typing errors. The share of the DisCos portion in dispute is not stated. The cover photograph shows a transmission point in Maryland, Lagos; we have not confirmed which operator owns it.