At NERC’s 20th Anniversary, Adelabu, Oseni, Adesina Chart New Course for Power Sector
At NERC’s 20th Anniversary, Adelabu, Oseni, Adesina Chart New Course for Power Sector
•Minister seeks transparent tariff-setting, service delivery
•NERC chief says over 30% more Nigerians experiencing improved electricity
•Adesina expresses doubt over states’ capacity to regulate supply market
Emmanuel Addeh in Abuja
The Minister of Power, Bayo Adelabu, yesterday said that the electricity supply sector must prioritise citizen-centred reforms, marked by transparent tariff-setting, enhanced metering through initiatives like the Presidential Metering Initiative (PPI), and holding all operators accountable for service delivery.
Adelabu, who spoke during the 20th anniversary celebration of the Nigerian Electricity Regulatory Commission (NERC) with the theme: “Strengthening Power Sector Governance for a Sustainable Future,” explained that ultimately, the success of ongoing reforms will be measured by their impact on the Nigerian people.
With states now empowered to challenge Distribution Companies (Discos) and the Transmission Company of Nigeria (TCN) to better serve their people, at the Federal Ministry of Power, the minister noted that the vision is one of cooperative federalism in the electricity sector – where both tiers of government work together in harmony for the common good.
To this end, he explained that Nigeria was developing a National Electricity Policy Coordination framework to ensure consistency and regulatory clarity, align federal and state actions; support states establishing new regulators; and strengthen investor confidence through policy.
Stressing that over the last two decades, the commission has laid the foundations for market stability – developing tariff frameworks, Adelabu, who was represented by the Director of Distribution at the ministry, Umar Mustapha, described the Electricity Act of 2023, as a landmark legislation.
“By opening the value chain to states and private investors, while fostering competition, which innovative pricing for consumers, it will ultimately lead to more options and better services,” he stated.
However, he stated that while some have proposed a strategic, city-by-city approach to achieving steady power, starting with state capitals by 2030, the pragmatic model allows for measurable progress and demonstrates the tangible benefits of expansion of reform and building confidence for further investment.
“However, this promising path also demands careful navigation. We must be mindful of the risks, including the potential for creating multiple, unsynchronised markets with conflicting regulations, which could confuse investors and strand power. The fragile national grid requires careful management to prevent fragmentation that could leave some regions behind,” he added.
He also highlighted the federal government’s recent approval of a N4 trillion bond to settle outstanding debts owed to power Generation Companies (Gencos) and gas suppliers, in a move aimed at stabilising Nigeria’s electricity market and restoring investor confidence.
The minister said the intervention, approved by President Bola Tinubu, would ease the liquidity crisis that has crippled the power sector and pave the way for reforms that strengthen the financial and operational capacities of power firms.
“The government is acutely aware of the debilitating liquidity crisis. This N4 trillion bond will clear verified Gencos and gas supply debts. Alongside this, we are developing a targeted subsidy framework to ensure a sustainable path toward full commercialisation,” Adelabu said.
He explained that the initiative forms part of a broader reform drive under the Electricity Act 2023, which allows states to develop and regulate sub-national electricity markets. According to the minister, the Act represents the most profound change in the sector’s history, empowering states to generate, transmit, and distribute electricity within their territories.
Earlier, NERC Vice Chairman, Musiliu Oseni, reflected on the Commission’s achievements over the past two decades, noting that effective regulation had saved the federal government several trillions of naira in subsidies and improved market stability.
Oseni said the Commission would focus on attracting private investment into the transmission segment of the value chain through its new Transmission Infrastructure Fund (TIF). He added that there must be deliberate federal policies to power industries for economic growth.
Besides, he explained that over 30 per cent more Nigerians now have more access to electricity than in the past when compared to 20 years ago.
“Despite the challenges, the Commission has recorded significant achievements in its two decade of existence. The Commission oversaw the privatisation and unbundling of the hitherto state owned vertically integrated monopoly.
“We have developed standard regulatory instruments to strengthen the electricity market, improve reliability of supply and enhance consumer protection. Relative to 20 years ago, not less than 30 per cent of the electricity consumers have experienced significant improvement in their electricity services.
“Through effective regulation, the Commission has saved the federal government several trillions of naira in subsidies, thereby contributing to improved fiscal position of the federal government,” he added.
In the same vein, he called for a reworking of the current model of spending of the about $2 billion available to the Rural Electrification Agency (REA).
He said, “You can power access through mini-grids, but you can’t power your economy to prosperity. Thus, there is a need for policy rethink on the utilisation of the $2 billion currently available to the Rural Electrification Agency (REA),” Oseni stated.
In his intervention, the Group Managing Director of Sahara Energy, Kola Adesina, commended the federal government’s resolve to address long-standing sector challenges but cautioned that inconsistent policies and regulatory misalignment had discouraged investors.
He argued that most Nigerian states lack the financial and technical capacity to develop electricity infrastructure despite the recent decentralisation of the power sector, cautioning hat allowing subnational governments to drive power development without adequate resources and alignment with national policy could worsen inefficiencies in the sector.
He said: “The states don’t possess the wherewithal to build electricity infrastructure. Let’s call a spade a spade. They don’t have the resources. Now, when you are breaking down inefficiency into another level of inefficiency, you’re only spreading the virus,” Adesina pointed out.
Also speaking, the Country Director for Nigeria at the World Bank, Mathew Verghis, commended NERC for its regulatory foresight, noting that its frameworks in the off-grid space have helped 7.8 million Nigerians gain access to electricity in the past five years.
“NERC’s forward-looking regulations have catalysed private sector investments into distributed renewable energy solutions. But there’s still much to be done to improve operational efficiency and financial sustainability,” he said.
He emphasised the importance of stronger governance, diversified power generation, and financially viable utilities capable of providing reliable services at competitive costs.
•Minister seeks transparent tariff-setting, service delivery •NERC chief says over 30% more Nigerians experiencing improved electricity •Adesina expresses doubt over states’ capacity to regulate supply market Emmanuel Addeh in Abuja
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