Author: O. M. Atoyebi S.A.N Contributor: Joy Ayara
The country’s economy is largely hinged on the availability of electricity, and this is because the stability or otherwise of the price of goods and services are largely dependent on the availability of electricity. The Nigerian electricity sector is to a large extent, regulated by the provisions of the Electric Power Sector Reform (EPSR) Act of 2005. This Act has empowered the Nigerian Electricity Regulatory Commission (NERC) with the mandate of ensuring efficient management of the electricity supply industry to meet the basic need of an average Nigerian for a stable, adequate and safe electricity supply, while ensuring that electricity operators recover cost on prudent investment and provide quality service to customers.
However, in the last decade, the Nigeria electricity sector has experienced an epileptic supply of power which has in turn, crippled businesses and caused an inflation in the prices of goods and services. Also, Nigeria’s national electricity grid statistically holds a record of having collapsed over 200 times and, in 2022 alone, 6 times. This has greatly affected the general supply of electricity across the country, and has necessitated a need for a review of the institutional and legal framework of the electricity sector.
The Senate in exercising its duties on the 21st of July 2022, passed the Electricity Bill 2022.
The primary objectives of this bill as stated in clause 1 are;
The key innovations that this bill set out to introduce in the electricity sector are in the following areas:
Section 3
SECTION 4
2. Regulation – This is provided for in section 5.
“The Minister of Power shall be responsible for the determination, formulation, and monitoring of government policy for the Nigerian Electricity Supply Industry and perform the following functions including other functions assigned to him under this Bill and other Acts of the National Assembly.”
“He/She shall exercise general supervision over the affairs and operations of the Nigeria Electricity Regulatory Commission (NERC) and agencies established under this Bill, “and for this purpose give general and specific policy direction including directions on overall system planning and coordination to the Commission or agencies established under this Bill, which the Commission or the agencies shall take into consideration in discharging their respective functions.”
3. Legislative oversight – This is provided for in section 6 of the bill.
Section 6
The bill also mandates the Transmission Company of Nigeria Plc (TCN) to issue licenses to Independent System Operators. The license covers the new entity to Operator to carry out such market and system operation functions as stipulated under this Bill.
It also states that anyone may construct, own, or operate an undertaking for generating electricity not exceeding 1 megawatt (MW) in aggregate at a site, or an undertaking for distribution of electricity with a capacity not exceeding 100 kilowatts (KW) in aggregate at a site, or such other capacity as the Commission may determine from time to time, without a license.
CONCLUSION
The new electricity bill is a long-awaited welcomed development, as it presents an opportunity to investors and industries to participate in the Nigerian energy market. Also, the states or businesses can own mini-grids this can, in turn, decentralize the national grid. Finally, it is hoped that the effective application of the electricity bill will bring an end to the generations of epileptic electricity supply in Nigeria.