Notwithstanding the above provisions of the constitution, no state government in Nigeria has yet taken advantage of the provisions of the constitution to develop off-grid, small-scale electricity for the benefit of residents of its state. The enabling statute, the Electric Power Sector Reform Act shows some defects typical of some developing countries to the extent of Federal-controlled, top-down paradigm of the power sector regulation in Nigeria. Aside from the NERC, the Act established an agency, to be known as the Rural Electrification Agency, which is a corporate body capable of suing and being sued in its corporate name. The REA administers the Rural Electrification Fund, a designated fund to promote, support and provide rural electrification programmes through public and private sector participation in order to: (a) achieve more equitable regional access to electricity; (b) maximise the economic, social and environmental benefits of rural electrification subsidies; (c) promote expansion of the grid and development of off-grid electrification; and (d) stimulate innovative approaches to rural electrification, provided that no part of the Rural Electrification Fund shall be used as subsidies for consumption. Though the development of the grid and off-grid electrification is the objective of the REF, the legal framework of REF also retained centralised governance arrangement like the NERC. This constitutes potential hindrance to the efficiency and effectiveness of the usage of the designated fund. As presently constituted, the administrative structures of REF and NERC might inevitably lead to administrative and regulatory overlaps. The Rural Electrification Project initiative would make practical sense if vested directly in state governments for administration within the local government councils in their domains. This is a form of decentralised, bottom-up electricity governance model to reduce the incidence of over-centralised electricity regime and the so-called National Grid debacles. This is because there are vital power projects spread across the length and breadth of Nigeria with the aim of boosting electricity supply in the country. Even though some of the power plants have been inaugurated and are generating power, they cannot be connected to the national grid due to over-centralised governance structure of electricity in Nigeria. A number of state governments in the country that are investing or have invested in power generation are also faced with challenges of distribution due to the nationalised structure of the grid.The Constitution of the Federal Republic of Nigeria places electricity generation, transmission and distribution on the Concurrent Legislative Listto enable the Federal and state governments partner in sustainable electricity. What obtains in practice is a negation of the constitutional provisions to the extent that electricity regulation in Nigeria clearly depicts the opposite of a decentralised regime envisaged by the constitution. Nigerians await effective implementation of the constitution through a genuinely decentralised electricity governance model that will eventually lead to the establishment, for example of "Ogun State Electricity Regulatory Commission", "Lagos State Electricity Regulatory Commission", "Edo State Electricity Regulatory Commission", "Kano State Electricity Regulatory Commission" just to speculatively mention a few. The implication of the above postulation is that the respective State Electricity Regulatory commissions will be able to license private companies to engage in off-grid electricity generation, transmission and distribution as provided by the constitution. It will also lead to a revolution in the power sector as transmission or distribution companies may back-off from the national grid to transmit off-grid from state structures to end users. This will eventually make electricity business more competitive and also afford the consumers ample options to choose like in the telecoms industry. There is no alternative to decentralisation of electricity governance in Nigeria: If the Federal Government is unable to ensure 24-hour electricity or something close to it, state governments should not be inhibited from doing so.We anticipate that some state governments will test the above constitutional provisions by establishing state electricity regulatory commissions by inviting private sector players to bid for licences to generate, transmit and distribute (small or medium scale) electricity off-grid- outside the national grid. It is also anticipated that litigation may be occasioned as the Supreme Court may eventually be invited to decide if the Federal Government can regulate electricity exclusive of state governments. As it stands, it is the considered view of the writer of this article that the current governance structure of electricity in Nigeria needs to be all-inclusive and participatory in line with the Decentralised Energy Options as articulated in this piece.Concluded.Dr. Oke teaches Electricity Law at the Faculty of Law, University of Lagos. yoke@unilag.edu.ng; yemioke@mjs-ca.com
Click here to read full news..
