NERC Transfers Edo Electricity Market Regulation To State Firm

The Nigerian Electricity Regulatory Commission (NERC) has officially transferred regulatory oversight of the electricity market in Edo State to the Edo State Electricity Regulatory Commission (ESERC).
NERC also issued mini-grid electricity generation permits to MTN Communications Nigeria Limited, Golden Penny Power Limited, Havenhill Synergy, and other companies.
NERC confirmed that the Edo State government met all legal requirements for the transfer, which is effective immediately.

As part of this transition, the Benin Electricity Distribution Company is directed to establish a subsidiary to handle local electricity supply and distribution responsibilities

This decision was made in compliance with the amended Constitution of the Federal Republic of Nigeria and the Electricity Act 2023, NERC disclosed this on its X handle on Wednesday.
According to the NERC, the Commission retains the role as a central regulator with regulatory oversight on the inter-state/international generation, transmission, supply, trading and system operations.

The Electricity Act 2023 mandates states that intend to establish and regulate intrastate electricity markets to notify NERC and request the transfer of regulatory authority.
It was noted that the Edo state government had complied with the necessary conditions and requested the transfer of regulatory oversight, leading to NERC’s order.
The order directs the Benin Electricity Distribution Company to incorporate a subsidiary, BEDC SubCo, to assume responsibilities for intrastate supply and distribution of electricity in Edo State.
BEDC has 60 days to complete the incorporation of BEDC SubCo, which will then apply for and obtain a licence from ESERC. The transfer is expected to be completed by February 20, 2025.
This move is seen as a significant step towards decentralising electricity regulation in Nigeria and allowing states to take control of their electricity markets.

NERC stated, “The transfer of regulatory oversight is in line with the Electricity Act 2023 and aims to promote more effective regulation and development of the electricity market in Edo State.

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Meanwhile, the granting of mini grid permits is part of a broader push to enhance off-grid power solutions across the country.

In the first quarter of 2024, NERC granted nine new off-grid generation licences with a combined capacity of 109.69 megawatts. Additionally, three new trading licences were issued. Among the companies receiving permits, MTN was authorised to build four captive generation plants in Lagos State, with a total capacity of 15.94 megawatts.

Golden Penny Power Limited secured a licence to construct six off-grid gas plants in Lagos, Oyo, Ogun, and Cross River states, with a cumulative capacity of 100 megawatts. Other companies, such as SweetCo Foods Limited, African Steel Mills Nigeria Limited, West African Ceramics Limited, Royal Engineered Stones Limited, and Armilo Plastics Limited, also received permits for captive power generation.

Captive power generation permits allow entities to generate electricity solely for their own consumption rather than selling it to third parties. NERC reported that in the first quarter of 2024, it issued nine such permits with a total nameplate capacity of 52.57 megawatts.

In addition to captive power permits, NERC also awarded mini-grid licences to several renewable energy companies, including Daybreak Power Solutions, TIS Renewable Energy Limited, Auro Nigeria Private Limited, Watts Exchange Limited, Centum Dopemu Energy Services Ltd, and DMD Electric Limited.

These mini-grid permits are part of an ongoing effort to promote renewable energy in Nigeria. Under Section 165(1)(m) of the Electricity Act 2023, NERC has the authority to grant mini-grid concessions to companies that generate and distribute electricity in specific geographical areas.

These permits allow developers to construct, operate, maintain, and, where applicable, own mini-grids with distribution capacities above 100 kilowatts and generation capacities up to 1 megawatt. For systems with distribution capacities below 100 kilowatts, NERC issues registration certificates.

In the first quarter of 2024, NERC issued three mini-grid permits and two registration certificates, continuing its support for the development and utilisation of renewable energy in Nigeria.