Seven States Take Control of Power Regulation Under Tinubu’s Electricity Act

The Nigerian Electricity Regulatory Commission (NERC) has confirmed that seven states—Enugu, Ondo, Ekiti, Imo, Oyo, Edo, and Kogi—have successfully taken over control of their electricity markets in accordance with the Electricity Act of 2023. Other states including Lagos, Ogun, Niger, and Plateau are expected to complete their transition to electricity self-regulation between June and September, while Anambra is also preparing to join after passing its own electricity law.

Before the enactment of this legislation by President Bola Tinubu in 2023, NERC was solely responsible for regulating the electricity sector. The Act now allows state governments to generate, transmit, distribute, and regulate electricity within their boundaries, thereby decentralising the country’s power framework.

While many stakeholders view this move as a step toward increased competition and improved power delivery, concerns are rising about the capacity of some states to handle such complex regulatory duties. There are fears of manpower shortages, insufficient technical expertise, and the absence of institutional frameworks.

NERC has already issued 11 transfer orders to states meeting the necessary criteria, granting them a six-month period for full takeover. For instance, Enugu has established its own electricity regulatory agency and licensed Mainpower Electricity Distribution Limited, a subsidiary of the existing distribution company, to operate under state laws. Lagos, Ogun, and others are expected to conclude their transition soon.

However, a NERC official warned that tariff-setting, asset delineation, and enforcement could pose serious challenges. Without trained personnel, states may struggle with core regulatory tasks, including addressing electricity theft and managing subsidies.

Stakeholders argue that while decentralisation may attract private investments, it could also lead to disparities in electricity access and consumer protection if not properly managed. Critics caution that state governments must not misuse their newfound authority or allow political interference to override public interest.

Energy experts like Adetayo Adegbemle and Kunle Olubiyo emphasised the importance of clearly defined state-federal responsibilities and robust regulatory structures to prevent chaos. They also warned that the lack of action by most states, despite receiving regulatory autonomy, points to unpreparedness.

Some states such as Ekiti and Ondo have made significant progress, establishing regulatory bureaus and working closely with existing Discos. However, others appear stalled after receiving approval.

Consumer advocacy leaders stress that strong compliance frameworks and metering systems are essential if this reform is to deliver on its promises. They also warn that a poorly executed transition could erode consumer trust and worsen service delivery.

Professor Dayo Ayoade from the University of Lagos advised that both federal and state governments must collaborate closely to ensure a smooth transition. He warned that investor confidence could suffer if states fail to implement clear and investor-friendly policies.

Ekiti State’s Commissioner for Infrastructure, Prof. Mobolaji Aluko, highlighted ongoing efforts to ensure a seamless transition, including the domestication of NERC regulations. Ondo State, which passed its electricity law in 2020, also said it has been engaging with stakeholders to operationalise its state electricity market fully.

While the move is seen as a landmark step toward true federalism and market liberalisation, experts agree that its success hinges on political will, institutional readiness, and a strong commitment to consumer protection.