Will Senate’s Bill to Boost Power See the Light of Day?

GAVEL

Udora Orizu writes that in a renewed effort to resolve the challenges in the power sector, the Senate has passed the Electricity Bill, 2022 to allow states generate and distribute power

Members of the Senate at the plenary last week passed the Electricity Bill, 2022 to allow states generate and distribute power. The bill will allow the federal government to license investors who intend to operate mini-grid within the state as against the initial situation where electricity was on the Concurrent List in the Constitution.

The poor performance of Nigeria’s power sector, resulting in unstable electricity supply and frequent grid collapse has long been seen by citizens as evidence of the ineffectiveness of the successive governments. Over the past decades, successive governments have struggled to tackle the country’s energy deficit by maintaining a monopoly in power provision. But despite billions of Naira spent annually on electricity, there’s little or no improvement to show for it. 

The national and states’ assemblies through enactment of various legislations have tried to solve the power sector problems.

Just like the Senate, the House of Representatives on its part had considered several bills on the Nigerian power sector, with public hearings on the bills held by relevant committees in the green chamber. Some of the bills include, Electric Power Sector Reform Act (Amendment) Bill, 2020 – HB 681, Electric Power Sector Act (Amendment) Bill, 2021 HB 1528, National Power Training Institute of Nigeria (Establishment) Bill, 2019 –HB 657, Energy Commission of Nigeria Act (Amendment) Bill, 2019 –HB 243, National Renewable Energy Development Agency (Establishment) Bill, 2021 –HB 1241, and Energy Commission of Nigeria (Amendment) Bill, 2019.

So bad has the power situation in Nigeria become that last week the Edo State House of Assembly, passed a bill to repeal the Rural Electricity Board Law of 1972 to re-enact a new law that makes provision for the generation, transmission and distribution of electricity for the residents of Edo State, paving the way for the establishment of an electricity market in the state was passed by the lawmakers.

 The lawmakers unanimously adopted all six parts of the bill during a session of the committee of the whole on July 19, 2022. The Speaker, Hon. Marcus Onobun, directed the assembly’s Clerk to forward clean copies of the bill for assent to Governor Godwin Obaseki.

The passed bill provides for the liberalisation of the electricity market in the state to allow for a more pragmatic approach to rural electrification and expansion of distribution infrastructure in the state.

 Similarly, earlier this year, a bill to reform the Delta State electric power sector passed second reading at the state House of Assembly. The proposed legislation was sponsored by Anthony Elekeokwuri (PDP-Ika North East) and 26 other PDP lawmakers.

Meanwhile, the Senate’s Electricity Bill, which scaled through second reading on September 28, 2021 was subjected to a two-day public hearing held from  February 28, to March 1, 2022.

The hearing was well attended by major stakeholders in the power sector, including the Nigerian Bulk Electricity Trading (NBET), Rural Electrification Agency (REA), Transmission Company of Nigeria (TCN), Distribution Companies (DisCos), Generation Companies (GenCos), among others.

However, in a letter to the Chairman of the Senate Committee on Power, Senator Gabriel Suswam, the governors of the 36 states faulted the bill. They particularly criticised a provision empowering the power minister to head all the relevant agencies.

The forum described the legislation as unconstitutional, saying that “electricity” is not an exclusive federal matter, but it is rather guided by the provisions of the Concurrent Legislative List.

In the letter signed by the NGF Chairman and Governor of Ekiti State, Kayode Fayemi, and addressed to the Senate President and Speaker of the House of Representatives, the governors noted that the reality of the states as key partners in the achievement of universal electricity access by all Nigerians must not only be accepted by the federal government but must be legislated by the National Assembly.

 They, therefore, called for a close collaboration between the NGF, the National Assembly and the Federal Executive Council in charting a new and productive path towards bringing energy security to the country.

On his part, the Minister of Power, Abubakar Aliyu at the public hearing, decried the dilution of some of the supervisory powers, saying that it rather needs to be strengthened.

He described the bill as a quantum leap in the right direction and presents the nation with a new paradigm to accelerate generation through diversification of the power sector to accommodate cleaner renewable energy sources in our energy mix.

The bill’s passage last week was sequel to the consideration of a report by the Committee on Power.

The Chairman of the Committee, Senator Suswam (PDP, Benue North East), in his presentation, said the bill seeks to, amongst others, provide an ideal legal and institutional framework to leverage on the modest gains of the privatisation phase of the electricity power sector in Nigeria.

Suswam noted that the bill would stimulate policy and regulatory measures to scale up efficient power generation, transmission and distribution capabilities of the sector; as well as address technological limitations and outdated infrastructure that are responsible for value chain loses.

He added that when signed into law, the bill would improve utilisation of generated power through increased investments in new technologies to enhance transmission and distribution of generated power to minimise aggregate value chain loses.

He said, “The bill, when signed into law, will open up the space in the power industry and allows states or individuals with capacities to generate their own power and distribute. Since electricity is on the Concurrent List in the constitution, the bill has allowed state governments to license people who intend to operate mini grid within the state.

“The bill also gives legal backing to renewable energy. If you decide to generate one megawatt of power using solar as energy source, that is also provided for. That is the only way the power problem would be solved. The space is now opened. There is little restriction as to who will generate power and distribute. What is obtainable now is that any power generated must be put on the national grid   for transmission and distribution. The bill also provides that any power generated below one megawatt does not require license to distribute.”

The Senate President, Lawan, in his remarks after the passage of the bill, said, “because of its importance and sensitivity, we would like to see a quick concurrence by the House of Representatives, because time is of essence as far as Nigeria is concerned when you “So, we would like to see that this bill is fully processed in the National Assembly and sent to the Executive side of government for the consideration for assent by Mr. President. We believe that this piece of legislation can change the fortunes of the electricity industry in Nigeria for the better.”

With passage, the bill will be sent to the House of Representatives for concurrence and thereafter transmitted to President Muhammadu Buhari for possible assent.

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