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NERC Cedes Regulatory Oversight To State Gov.

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In an official memo released Monday, April 22, 2024, the Nigerian Electricity Regulatory Commission (NERC) has handed over the regulatory oversight of the Enugu electricity market to the Enugu Electricity Regulatory Commission (EERC), a state-owned regulatory body. This transfer of authority will be effective from May 1, 2024, and marks the first time NERC has delegated such power to a state-owned regulatory body. As per the memo, the Enugu Electricity Regulatory Commission (EERC) will now have exclusive control to set and adopt end-user electricity tariffs within Enugu State, customizing these charges to suit local conditions and needs.

The memo states thus: “This regulatory instrument may be cited as the Order of Transfer of Regulatory Oversight of the Electricity Market in Enugu State from NERC to the Enugu State Electricity Regulatory Commission (EERC). This Order shall take effect from May 1, 2024.”

The memo provides a framework for states to establish their regulatory authorities and manage the transition of oversight. As per Section 230 of the Electricity Act 2023, if a state wants to regulate its electricity markets, it must inform NERC and the relevant distribution licensee.

Following this, NERC must prepare a transition plan within 45 days, detailing the transfer of regulatory responsibilities to the state regulator. This process should be completed within six months of notification.

This decentralization initiative aims to enhance efficiency and responsiveness in the management of electricity services by aligning regulatory oversight more closely with local needs and conditions.