New Regulation Gives Nigerian States Right to Generate and Distribute Electricity

The 36 Nigerian state governments  will next month get the statutory right to generate and distribute electricity from their domain.

Chairman, Nigeria Electricity Regulatory Commission (NERC), Dr. Sam Amadi, disclosed this yesterday in Abuja at a stakeholders’ workshop on the review of the Independent Electricity Distribution Network draft regulation.

He said this would be actualised when the commission’s new set of regulations guiding Independent Electricity Distribution Network Operators and Power Generators becomes operational.

According to the commission, an Embedded Generation is when a power plant is built in a particular locality and not connected to the national grid for transmission.It is a situation whereby the generated capacity is connected directly to the distribution network.

A t presently, the Federal Government has the exclusive right of power generation and distribution for commercial purposes,　 except for some companies that NERC licensed to produce limited power for their industrial applications.

Amadi disclosed that as the regulation is takes off to take effect from next month, 　it is also expected that states with the capacity to generate power in their domain will come forward to seek licenses for operation.

Explaining the method of operation of the new initiative, the chairman noted that it will ensure: “All the cost associated with transmission is bypassed. It is embedded with the distributor locally. It can cure acute shortages of power in the short and long run. A state that has the capacity can have partnership with private sector, set up a power plant to carter for the need of the state.”

Amadi, however, said the regulation is predicated on the states’agitation for the removal of power from the exclusive list.

He cited Governor Rotimi Amaechi of Rivers State as one of the governors, who sought that states be allowed to generate their own power to help lift the country from power crisis.

The chairman said: “Instead of running parallel lines running through the cities, you can have power embedded in your state, if you have enough capacity. For instance, Rivers has sufficient capacity. Instead of taking it to the grid,　 you can have power embedded in the state and the surplus you can sell to the grid if you like. What is required is that you have sufficient capacity to distribute that power. That is why we are bringing these new regulations. The cost of evacuating power to the grid and later transmitted back for use locally will be removed.”

The NERC commissioner, Legal and Licensing Services, Mr Steven Azinge, said the draft regulations are a product of painstaking effort with input from experts and relevant stakeholders.

Besides, he noted that another window of three weeks will further be opened to receive comments and suggestions from stakeholders for more input to improve the document.

He said the final regulation would be sent to the Ministry of Justice for gazzeting, while the regulation will come into force by January.

One Comment

1. 

   Anonymous

   December 8, 2011 at 9:18 pm

   This is what is needed in Nigeria… Let the States do most of the So-called exlusive list items. At the federal level, loyalty has fallen but with the States, there would be more sense of belonging that would on the long-run leverage performance. That would also  creat  innovative ways which States can duplicate from one another..