THE Nigerian Electricity Regulatory Commission (NERC) has ordered the transfer of regulatory oversight of the electricity market in Oyo State to the Oyo State Electricity Regulatory Commission (OSERC).
This development complies with the amended Constitution of the Federal Republic of Nigeria (CFRN) and the Electricity Act 2023 (Amended).
According to the Electricity Act, the amended Paragraph 14(b) Part II of the Second Schedule to the 1999 Constitution empowers state governments to legislate on electricity provision within their territories.
With the Electricity Act 2023, NERC retains the role as a central regulator with regulatory oversight which oversees the inter-state/international generation, transmission, supply, trading, and system operations.
According to NERC, the Electricity Act also mandates any state that intends to establish and regulate intrastate electricity markets to deliver a formal notification of its processes and requests NERC to transfer regulatory authority over electricity operations in the state to the State Regulator.
Based on this, the Commission said the government of Oyo state complied with the conditions precedent in the laws, duly notified NERC, and requested for the transfer of regulatory oversight of the intrastate electricity market in Oyo State.
The transfer Order by NERC has the following provisions:
“Direct Ibadan Electricity Distribution Company (IBEDC) to incorporate a subsidiary (IBEDC SubCo) to assume responsibilities for intrastate supply and distribution of electricity in Oyo State from IBEDC.
“IBEDC shall complete the incorporation of IBEDC SubCo within 60 days from 6th August 2024. The subcompany shall apply for and obtain licence for the intrastate supply and distribution of electricity from OSERC, among other directives.
“All transfers envisaged by this order shall be completed by 5th February 2025”, it said.
Apart from Oyo state, The ICIR reported that several other states are firming up control of regulatory oversight of electricity business in their respective territory with the support of the Nigerian Electricity Regulatory Commission (NERC).
The states’ control came on the heels of the Electricity Act 2023, signed by President Muhammadu Buhari and later amended by President Bola Tinubu.
The Act removed power generation, transmission, and distribution from the exclusive legislative list, effectively ending the federal government’s sole jurisdiction over these areas.
The development is expected to open up the states for electricity business, energy analyst said.
“This is a good development for states and they will be more than willing to invest in the electricity business in their respective states and firm up control of regulation in their states. They will be able to set up sub-DisCos which would allow for states to get more involved in the electricity business,” the executive director of PowerUp Nigeria, Adetayo Adegbemle told The ICIR.
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.