Ekiti Joins Enugu, Emerges Second State to Float Own Electricity Regulatory Body

•Ondo gets commission too

Emmanuel Addeh in Abuja

Ekiti has emerged the second state to float its own electricity regulatory body, after the Nigerian Electricity Regulatory Commission (NERC) announced earlier that Enugu had signified its intention to fully exit the control of the apex industry regulator.

Couched after the Enugu model, NERC in the document signed by the Chairman of the Commission, Sanusi Garba and the Commissioner, Legal, Licensing and Compliance, Dafe Akpeneye, stated that the action was in compliance with the amended Constitution of the Federal Republic of Nigeria (CFRN) and the Electricity Act 2023, as amended.

President Muhammadu Buhari had in March 2023 assented to the law, which now empowers states to licence, generate, transmit and distribute electricity. His successor, President Bola Tinubu, has also made at least two amendments to the law since he took over the reins of power in May, 2023.

The electricity market in Nigeria was previously centralised,  but the law now grants legislative autonomy to federating states in Nigeria to legislate on the generation, transmission and distribution of electricity within their jurisdictions.

NERC stated that the Government of Ekiti State had complied with the conditions precedent in the laws, duly notified it and requested for the transfer of regulatory oversight of the intrastate electricity market in the state to the body to be known as the Ekiti State Electricity Regulatory Bureau (EERB).

According to the apex regulatory commission for the power sector, when the process is fully completed,  Ekiti shall assume responsibilities for intrastate supply and distribution of electricity in the state.

“In compliance with the amended Constitution of the Federal Republic of Nigeria (CFRN) and the Electricity Act 2023 (Amended), the Nigerian Electricity Regulatory Commission (NERC or the Commission) has issued an order to transfer regulatory oversight of the electricity market in Ekiti State from the Commission to the Ekiti State Electricity Regulatory Bureau (EERB).

“Recall that with the Electricity Act (EA) 2023, the Commission retains the role as central regulator with regulatory oversight on the inter-state/international generation, transmission, supply, trading and system operations.

“The EA 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 Government of Ekiti 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 Ekiti State,” it stated.

The commission added that the transfer Order by NERC has the following provisions: “Direct Benin Electricity Distribution Company (BEDC) and Ibadan Electricity Distribution Company PLC (IBEDC) to incorporate a subsidiary (BEDC SubCo and IBEDC SubCo) to assume responsibilities for intrastate supply and distribution of electricity in Ekiti State from BEDC and IBEDC.

“BEDC and IBEDC shall complete the incorporation of BEDC SubCo and IBEDC SubCo within 60 days from  April 22, 2024 and the sub-companies shall apply for and obtain licences for the intrastate supply and distribution of electricity from Ekiti Electricity Regulatory Bureau (EERB), among other directives.”

All cross-border transactions involving the national grid, it said , shall be subject to the approval of the commission in accordance with the constitution and the Electricity Act.

It stressed that the EERB shall have the exclusive responsibility of determining and adopting an end-user tariff methodology applicable within its area of regulatory oversight.

“Where IBEDC SUbCO receives electricity from grid connected plants, the contracts and tariffs applicable for generation and transmission services shall be approved by the commission.

“The final end-user tariffs approved by EERC shall be the exclusive tariffs that apply in Ekiti state and all tariff policy support for end-use customers in Ekiti state shall be the responsibility of the Ekiti state government,” NERC stated.

Also, NERC has announced the impending transfer of regulatory oversight of the electricity market in Ondo State to the Ondo State Electricity Regulatory Bureau (OSERB).

It therefore directed BEDC to also incorporate a subsidiary to assume responsibilities for intrastate supply and distribution of electricity in Ondo State from the Distribution Company.

“BEDC shall complete the incorporation of BEDC SubCo within 60 days from 22 April 2024 and the sub-company shall apply for and obtain licence for the intrastate supply and distribution of electricity from OSERB, among other directives. All transfers envisaged by this order shall be completed by October 22, 2024,” it stated.