The Nigerian government is planning to investigate regional energy potential with the goal of revolutionizing the power industry in an attempt to give homes and businesses in the nation with a consistent and dependable supply of electricity.
At the Power Correspondents’ Association of Nigeria (PCAN) Third Annual Workshop, with the theme “Resolving Nigeria’s Power Crisis: The Implication of the Electricity Act, 2023,” Nigeria’s Minister of Power, Adebayo Adelabu, revealed this.
The minister said that the theme was very appropriate in light of Nigerian President Bola Ahmed Tinubu’s goal to liberalize the power industry by passing the Electricity Act, 2023, and guarantee a steady supply of electricity for the entire nation.
He claims that the Electricity Act, 2023, is an important component of the nation’s energy strategy because it demonstrates the current administration’s commitment to the reform of the power industry, as made explicit in Mr. President’s “Renewed Hope” plan.
Recall that on June 9, 2023, President Tinubu signed the Electricity Bill into law, enabling states, businesses, and private citizens to produce, transfer, and distribute electricity.
Considering everything mentioned above, Nigerians will soon begin to experience the Act’s primary goal—improving the nation’s electricity supply—especially with the sector’s liberalization.
“As you are aware, the distribution, transmission, and production of electricity have been liberalized under the Electricity Act. Additionally, it has given states, institutions, and even private citizens the ability to produce, transmit, and distribute electricity.
Private investors may be granted licenses by state governments to run power plants and mini grids inside their borders under the terms of this Act.
Licenses for generating, transmission, system operations, trading, distribution, and supply can also be obtained by private investors.
The Nigerian Electricity Regulatory Commission’s (NERC) renewable energy requirements must be met by licensees, and the Act also promotes the integration of renewable energy technology into the current grid system.
The Act included a system of incentives for investment in the industry, among other things. Feed-in-tariffs, which provide a set price for renewable energy delivered into the grid, and tax breaks for investors are two examples of these incentives.
“The Act also provides explicit criteria for market participants’ licensing, monitoring, and supervision in order to provide a level playing field for all competitors in the sector and avoid anti-competitive practices.
“In addition, the Act ensures asset protection by permitting investors to sell or transfer their ventures in the event that licenses are revoked or to receive compensation in the event that such ventures are taken over,” the minister of power added.
He confirmed that the re-enacted Electricity Act, in its whole, had completely altered the Nigerian power industry.
Speaking earlier, Mr. Obas Esiedesa, the Chairman of the Power Correspondents’ Association of Nigeria (PCAN), stated that the workshop’s original goals were to provide a platform for journalists covering the power sector to engage with regulators and industry participants while also developing the skills of those journalists.
The commencement of private investment in the Nigerian electricity supply industry occurred on November 1, 2013, when the Federal Government turned over the distribution and majority of the generation assets to the private sector.
Ten years later, it is now necessary for the federal government to conduct a comprehensive analysis of the privatization of the whole power sector. This review should focus on finding answers to the major problems the industry is currently facing rather than on taking away operators’ assets.
It is concerning that despite having installed capacity of over 13,000 megawatts, the industry is still unable to reliably produce 4,000 megawatts of electricity.
The chairman of the association stated, “That is why, as a group, we welcome the new initiative by the Minister of Power, Chief Adebayo Adelabu, that has specifically targeted the distribution sector and the consumers.”
He called for sincerity in the execution of the new power Act, 2023, noting that transmission and distribution networks continue to be the nation’s largest barriers to an efficient and effective supply of power.