States Delay Electricity Market Takeover Under New Act

The Nigerian Electricity Regulatory Commission (NERC) has disclosed that Rivers, Kano, and 19 other states have yet to assume regulatory control of the electricity market, nearly three years after the enactment of the Electricity Act 2023. Currently, 15 states, including Enugu, Ekiti, and Ondo, have transitioned to independent market oversight.

The act empowers subnational governments to regulate electricity generation, transmission, and distribution within their territories, which is essential for attracting investment and improving local tariff structures. The NERC noted that the earliest transition for the remaining states could occur in October 2024, with Enugu and Ekiti expected to assume regulatory authority soon.

The slow pace of transition raises concerns that these states may miss opportunities to attract investments, particularly for off-grid electrification projects in underserved rural communities. The overall success of the Electricity Act reforms will largely depend on how quickly the remaining states establish their regulatory frameworks.