Former Chairman of the Nigerian Electricity Regulatory Commission (NERC), Dr Sam Amadi, has declared that the Minister of Power, Chief Adebayo Adelabu, has no powers to stop the transfer of electricity market regulatory oversight to states as authorised by the Electricity Act 2023 (Amended).
The Minister of Power, Chief Adebayo Adelabu at the 8th Edition of the Africa Energy Market Place (AEMP) held last week in Abuja, stated that he has directed NERC to stop the transfer of electricity market regulatory oversight to the states, because the market is not yet mature for that.
However, Amadi, who spoke in an interview on Tuesday, noted that “the Act authorizes NERC to make the decision when the conditions have been met.
“The best the Minister could do is to advise NERC to review its decisions and NERC could pause issuing further orders of transfer of regulatory power until it completes the review”, he said.
Although the Minister, while justifying his action, pointed at the huge capacity issue in the sector, and the unequal concentration of power plants in parts of the country as the main reasons for the decision.
He argued that even with the centralised regulator (NERC), the sector is faced with a myriad of issues, therefore, the plan to create a regulatory framework across the 36 states and the Federal Capital Territory (FCT) must be strategically done.
Adelabu, however, disclosed that discussions are ongoing with the NERC to use four states or the six geopolitical zones as pilots because of the peculiarities associated with the electricity market in the country, both on the supply and demand side.
He cited an instance of Hydro-electric power being highly concentrated in the Middle Belt with its environmental peculiarities, and the Thermal plants (Gas Power Plants) being highly concentrated in the South, Southeast, Midwest and some parts of the West, with pipeline issues, environment issues and Right of Way issues.
Noting that “when we have each of these zones represented in the pilot and we allow it to run for three, six months, or up to a year, all the possible issues will have been reflected, so we are going to have a learning curve, and all those issues will be addressed before granting further regulatory autonomy because I have a feeling that we don’t have a comprehensive understanding of what this autonomy means”.
On capacity required for state oversight, he said, it is grossly inadequate, adding that more investments are needed to build capacity locally, across the 36 states and the FCT in preparation for state’s regulatory oversight.
However, speaking on Monday during a two-day stakeholder’s workshop on the implementation of the Electricity Act, organised by the Nigerian Electricity Regulatory Commission in Lagos, the Minister reversed his earlier decision.
He said, “Granting of regulatory autonomy to states is a provision of the new Act and no one person can single-handedly go against the Act.
“It’s a provision of the law and no law-abiding officer of the state will want to go against the law. It is already included and it must be duly respected”, he noted.
Meanwhile, Amadi said, “This action shows the depth of lack of public policy in the current leadership in the sector”.
NERC last month, in compliance with the amended Constitution of the Federal Republic of Nigeria (CFRN), and the Electricity Act 2023 (Amended), issued an order to transfer regulatory oversight of the electricity markets in Enugu State, Ekiti State, and Ondo State from the Commission to their Electricity Regulatory Commissions, while retaining its role as a central regulator with regulatory oversight on the inter-state/international generation, transmission, supply, trading and system operations.
Source: TheFact Daily
