June 22, 2024
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ELECTRICITY

Nigeria’s NERC Directs Transfer of Electricity Market Regulation to EERB, OSERB

The Nigerian Electricity Regulatory Commission (NERC) has mandated the transfer of regulatory authority over electricity markets in Ekiti and Ondo states to the Ekiti State Electricity Regulatory Bureau (EERB) and the Ondo State Electricity Regulatory Bureau (OSERB), respectively.

This action aligns with the amended constitution of the Federal Republic of Nigeria and the Electricity Act (EA) 2023. Earlier, on Monday, the Commission had directed the shift of regulatory oversight of the electricity market in Enugu to the Enugu State Electricity Regulatory Commission (EERC) under order NERC/2024/039.

Outlined in a statement by NERC chairman Sanusi Garba and commissioner Dafe Akpeneye, the directive stipulates that all transitions involving the Benin Electricity Distribution Companies (BEDC), Ibadan Electricity Distribution Company (IBEDC), EERB, and OSERB must be completed by October 22, 2024.

Effective from May 1, 2024, as per the Electricity Act 2023, this transfer signifies a departure from the previously centralized structure of the nation’s electricity market. Following presidential assent to amendments in March last year, sub-national governments gained legislative autonomy over electricity matters within their respective states.

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In response to formal notifications from Ekiti and Ondo states, NERC has developed a transition plan for transferring regulatory oversight from the federal level to EERC, EERB, and OSERB. Both states have met the legal prerequisites, prompting NERC’s action.

Additionally, the order mandates BEDC and IBEDC to establish subsidiaries, BEDC SubCo and IBEDC SubCo, to manage intrastate electricity supply and distribution in Ekiti and Ondo states. Cross-border transactions involving the national grid remain subject to NERC approval.

EERB and OSERB will now have sole responsibility for determining end-user tariff methodologies within their jurisdictions. However, final approval for tariffs related to generation and transmission services will still fall under NERC’s purview.

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