Nigeria’s president, Bola Tinubu recently signed the electricity act, which authorizes states, companies and individuals to generate, transmit, and distribute electricity.
The act which substitutes the 2005 electricity and power sector reform Act , cuts away all forms of monopoly in aspects of power generation and distribution which has been the norm overtime.
According to president Tinubu, the act seeks to fashion a comprehensive legal and institutional framework to guide the Nigerian Electricity Supply Industry (NESI).
Consequently, to provide an ideal Institutional framework, it also fuses all legislations dealing with the electricity supply industry.
The Jurist brings you 10 things you need to know about the newly signed electricity act.
1.The act authorises the Nigerian Electricity Regulatory Commission (NERC) to regulate the electricity sector in Nigeria. The NERC is self-governing of the powers of the states to legislate laws and establish electricity markets within their respective territories.
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2.The act stipulates policy measures that will attract private sector investments across the Nigerian Electricity Regulation Industry (NERI) to stimulate economic growth, and initiate more job creation and thus, improve the living conditions of Nigerians.
3.The act provides for policies that addresses technology constraint and obsolete infrastructure which contribute to the value chain losses in the Nigerian Electricity Supply Industry (NESI).
4.Electricity generation licensees are obliged to meet renewable generation requirements as could be recommended by the NERC.
5.For power generating companies, they will be mandated to generate or purchase electricity from renewable energy sources. The act also allows for procurement of instruments representing renewable energy generation.
6.It promotes a framework for security and electricity infrastructure to see that punishments are in place to against electricity thieves and other offenders peculiar to the NESI.
7.Carrying out oversight responsibilities and function over the NESI through its respective committees on power in the Senate and House of Representatives will be done by Lawmakers.
8.Only Lagos, Edo, and Kaduna states can regulate electricity business exclusively within their states, since they have electricity market laws. However, the act makes process for NERC to transfer regulatory responsibilities to state regulators once they are established.
9.The act also provides for measures that will increase geographic coverage in power generation, transmission, distribution and supply of electricity in Nigeria.
10. In the act, issuance of licenses to private investors who can operate mini-grids and power plants within the state is permissible but interstate and transnational electricity distribution is unacceptable.
As implementation of the act is hopefully underway, Nigerians are expecting that this newly signed policy will translate to a much more efficient power supply, thereby reducing the cost of alternative power supply.