NERC Hands over Electricity Regulation, Oversight Powers to Lagos Government

•Orders Eko, Ikeja Discos to create subsidiaries for state’s electricity market

Peter Uzoho

The Nigerian Electricity Regulatory Commission (NERC) has formally transferred the power of regulation and oversight of the electricity market in Lagos to the newly-set up Lagos State Electricity Regulatory Commission (LASERC).

The national power regulator also ordered the two main electricity distribution companies (Discos) in the state – Eko Electricity Distribution Company (EKEDC) and Ikeja Electric to create subsidiaries in the Lagos electricity market to improve power service delivery in the state.

NERC announced this in a statement issued yesterday. Governor Babajide Sanwo-Olu of Lagos State had recently signed the Lagos Electricity Bill 2024 into law.

The Electricity Act 2023 decentralized the hitherto centralized Nigeria’s power sector, giving states the autonomy to generate, transmit, and distribute electricity.

In the statement, NERC stated that based on the provision of the Electricity Act, the government of Lagos State has 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 Lagos State.

The move aligns with Nigeria’s constitutional reforms, which allow states to establish and regulate their own intrastate electricity markets.

Lagos State, having fulfilled the legal requirements, had formally requested the transfer of regulatory authority from NERC to LASERC.

In response, NERC issued an order mandating the incorporation of new subsidiaries by Eko Disco and Ikeja Electric to manage intrastate electricity supply and distribution exclusively within Lagos State.  These subsidiaries, according to NERC, must secure operational licences from LASERC within 60 days, with the full transition set for completion by June 2025.  

This swift action emphasized Lagos State’s determination to take charge of its electricity market, improve supply reliability, and attract investment into its energy sector.

Lagos State has become the 8th state approved by NERC to establish and regulate a state-owned electricity market, joining the ranks of Enugu, Ondo, Edo, Imo, Ekiti, Oyo, and Kogi.

The states have therefore advanced the approval from the NERC to establish and operate state-owned electricity markets.