Minister: Nigeria to investigate regional energy potential under Electricity Act, 2023

The Nigerian government is planning to investigate regional energy potential targeted at revolutionizing the power sector in an attempt to deliver a consistent and dependable supply of electricity to homes and businesses in the nation.

This was revealed by Adebayo Adelabu, Nigeria’s Minister of Power, at the Power Correspondents’ Association of Nigeria (PCAN) Third Annual Workshop, which had as its theme “Resolving Nigeria’s Power Crisis: The Implication of the Electricity Act, 2023.”

The minister deemed the theme to be highly appropriate, given that President Bola Ahmed Tinubu of Nigeria intends to liberalize the power industry by passing the Electricity Act, 2023, in order to guarantee a consistent supply of electricity throughout the nation.

As per his perspective, the Electricity Act, 2023 holds great importance in the nation’s energy strategy since it expresses the current administration’s resolve to revolutionize the power industry, as explicitly mentioned in the President’s “Renewed Hope” plan.

Remember that President Tinubu signed the Electricity Bill into law on June 9, 2023, enabling states, businesses, and private citizens to produce, transfer, and distribute electricity.

Taking into account everything said above, particularly with the sector’s deregulation, Nigerians will soon begin to feel the Act’s primary goal—improving the nation’s electricity supply.

The generation, transmission, and distribution of electricity have been liberalized, as you are aware, by the Electricity Act. Additionally, it has made it possible for governments, businesses, and even private citizens to produce, transmit, and distribute electricity.

A state government may grant licenses to private investors under this Act so they can run small grids and power plants inside the state.

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Licenses for supply, distribution, trade, system operations, generation, and transmission are also available to private investors.

“While licensees are expected to fulfill renewable energy obligations as specified by the Nigerian Electricity Regulatory Commission (NERC), the Act also promotes the integration of renewable energy technologies into the current grid system.”

The Act, among other things, established a system of incentives for industry investment. Tax breaks for investors and feed-in tariffs, which ensure a set price for renewable energy supplied into the grid, are two examples of these incentives.

The Act also lays out precise rules for market participants’ licensing, oversight, and monitoring in order to guarantee fair competition for all parties involved and avoid anti-competitive behavior.

In addition, the minister of power clarified, “the Act ensures asset protection by permitting investors to sell or transfer their undertakings in the event of license revocation or compensation in the event of takeover of such undertakings.”

He confirmed that the Nigerian power industry has undergone a complete transformation as a result of the recently reenacted Electricity Act.

The workshop was designed from the start to give journalists covering the power sector a chance to develop their skills and to connect with regulators and industry participants, according to Mr. Obas Esiedesa, Chairman of the Power Correspondents’ Association of Nigeria (PCAN).

“Private investment in Nigeria’s electricity supply industry began on November 1, 2013, when the Federal Government turned over the majority of generation and distribution assets to the private sector.

It is now time for the federal government to conduct a comprehensive evaluation of the power sector’s privatization, focusing on finding answers to the major problems the sector is facing rather than just taking away operators’ assets after ten years.

The sector still struggles to routinely deliver 4,000MW of energy, which is concerning given that it has over 13,000 megawatts of built capacity.

The head of the organization stated, “As a group, we applaud the new initiative by the Minister of Power, Chief Adebayo Adelabu, which has specifically targeted the distribution sector and the consumers.”

He emphasized that the nation’s transmission and distribution networks continue to be the key barriers to an efficient and effective supply of power, and he urged honesty in the execution of the recently passed power Act, 2023.