As a result of the Enugu State Electricity Law signed by Governor Peter Mbah and the establishment of the Enugu State Electricity Regulatory Commission (ESERC) by the Mbah administration, the Nigerian Electricity Regulatory Commission (NERC) has officially handed over the regulatory responsibility of the Enugu State electricity market to the state agency, effective May 1, 2024.
For the first time, NERC is relinquishing such regulatory powers to a state electricity regulatory agency.
This transfer was communicated by NERC on Monday through an Order No. NERC/2024/039 dated April 22, 2024, signed by the Commission’s Chairman, Sanusi Garba, and the Commissioner for Legal, Licensing, and Compliance, Dafe Akpeneye.
The transfer follows the amendments to Paragraph 14 (b) of the Second Schedule to the 1999 Constitution by the 9th National Assembly in 2023 and the Electricity Act 2023. These changes shifted power generation, transmission, and distribution from the Exclusive List to the Concurrent List, empowering states to regulate their electricity markets within their jurisdictions.
It is worth noting that the Enugu State Electricity Bill 2023 was championed by the Mbah administration and signed into law in September of that year. Subsequently, the Enugu State Electricity Regulatory Commission (ESERC) was established in March 2024, with Chijioke Okonkwo appointed as the Chairman/CEO.
According to the Electricity Act 2023, within 45 days of being formally notified of the law’s enactment, NERC must provide a draft order to the State Regulator outlining a plan and timeline for transitioning regulatory responsibilities. This transition must be completed within 6 months of receiving the formal notification.
NERC clarified that ESERC now has the exclusive authority to determine end-user electricity tariffs in Enugu State, tailoring them to local conditions and needs. While ESERC manages local tariff methodologies, approval for electricity sourced from grid-connected plants and related tariffs must still be obtained from NERC to align with national energy policies.
Moreover, final tariffs approved by ESERC for consumers in Enugu State will be binding, with the Enugu State Government responsible for implementing fair tariff-related policies that meet the specific requirements of residents.
As part of the directive, NERC instructed that Enugu Electricity Distribution Company PLC (EEDC) establish a subsidiary, EEDC SubCo, under the Companies and Allied Matters Act to handle intrastate electricity supply and distribution within Enugu State. EEDC has 60 days from the effective date to complete this process, obtain a license from EERC, and fulfill other outlined obligations.