The Nigerian Electricity Regulatory Commission (NERC) has taken a significant step towards the implementation of the new Electricity Act 2023 by inaugurating three working groups. President Bola Tinubu signed the new Act in June 2023, which removed electricity from the exclusive list, granting states the authority to generate and regulate power within their jurisdictions.
NERC Chairman, Sanusi Garba, officially launched the Legal and Regulatory Working Group, Engineering and Technical Working Group, and the Commercial and Transaction Group during a stakeholders meeting held in Abuja on Monday.
In his statement, Garba emphasized that the primary focus of implementing the new Electricity Act is to empower states to take charge of formulating electricity laws specific to their regions. He highlighted that NERC would collaborate with states in the process of transitioning to state-level regulation of electricity.
Garba stated, “The focus in the implementation of the Electricity Act seems to be about states taking over the responsibilities of making electricity laws for their area. Arising from the workshop we organized in Lagos, it takes a process for states to start regulating electricity in their areas, and NERC is collaborating with them on this.”
To facilitate this collaborative effort, NERC has established three working groups: the Legal and Regulatory Working Group, the Engineering and Technical Working Group, and the Commercial and Transaction Group. These groups, along with NERC, will engage in discussions on key areas outlined in the Electricity Act over the next three months.
NERC Commissioner for Planning, Research, and Strategy, Dr. Yusuf Ali, highlighted one significant aspect of the Electricity Act—transitioning the Nigerian power sector to a two-tier regulatory regime, involving federal and state regulation.
Vice Chairman of NERC, Musiliu Oseni, urged members of the working groups to contribute their best efforts to ensure a comprehensive and robust report. Oseni expressed the collective desire for a functional electricity sector and a thriving electricity market that benefits the nation.
Among the notable benefits of the new Electricity Act is the provision allowing investors to construct, own, or operate electricity generation projects not exceeding one megawatt, or distribution projects with a capacity not exceeding 100 kilowatts, without the need for a license. States now have the authority to regulate their electricity markets by issuing licenses to private investors for mini-grids and power plants within their borders. However, until states establish their electricity market laws, NERC will continue regulating electricity businesses in those states.
