- Sanusi Garba, NERC Chairman, has emphasized the Commission’s authority to create subsidiary legislation for the power sector, enabling the promulgation of binding regulations and technical codes for all industry participants and licensees.
- NERC plays a dual role, not just as a regulator but also in a quasi-judicial capacity, with Commissioners forming panels to handle disputes, appeals, objections, rates, and other crucial matters within the electricity industry.
Sanusi Garba, the Nigerian Electricity Regulatory Commission (NERC) Chairman, underscored the Commission’s vested authority to establish subsidiary legislation governing the power sector. He said this during his speech at the 4th Seminar for Judges recently organised by NERC.
According to Sanusi Garba, NERC is bestowed with the power to promulgate regulations and technical codes that are binding on all industry participants and licensees. Additionally, the Commission assumes a quasi-judicial role, where Commissioners convene to form panels for the purpose of adjudicating disputes, appeals, objections, rates, and other pertinent matters within the industry.
Garba drew attention to a legal challenge initiated by a civil rights lawyer in May 2016 against the Commission and 11 Distribution Companies (DisCos). This legal dispute emanated from a tariff order issued by NERC, stipulating rates for DisCos effective January 1, 2015.
The central legal queries revolved around whether NERC lawfully sanctioned a tariff increase without significant enhancements in the power supply and whether there were adequate consultations before approving the new rates.
The court responsible for overseeing the case granted an injunction, thereby suspending the implementation of the tariff order and causing a prolonged delay in the electricity market reform spanning several years. This extended delay placed considerable financial burdens on the Federal Government, stemming from revenue shortfalls experienced by market participants.
Consequently, Garba noted that the Manufacturers Association of Nigeria (MAN), which actively opposed the new rates, now finds itself burdened with substantial debts owed to DisCos, and a viable path to recovery appears elusive in the medium term.
Note that the primary objective of the seminar is to provide a platform for in-depth discussions surrounding emerging legal issues within the Nigerian Electricity Supply Industry, with a particular focus on updating the judiciary about recent regulatory changes.