- NERC adopts the AFUR mini-grid Tariff Tool to ensure fair pricing and regulatory consistency for mini-grid projects in Nigeria.
- Starting December 16, 2024, all mini-grid developers must use the AFUR tool to file permit applications with the Nigerian Electricity Regulatory Commission.
The Nigerian Electricity Regulatory Commission (NERC) has officially adopted the African Forum for Utility Regulators (AFUR) mini-grid Tariff Tool to ensure fair and efficient pricing within the mini-grid sector. In a statement on its official X page on Friday, 13th December 2024, NERC highlighted that the tool was developed in collaboration with AFUR and other key energy sector stakeholders.
The tool supports implementing the amended Mini-Grid Regulations 2023 and aims to help determine cost-reflective tariffs for mini-grid projects. It includes new features, such as Portfolio Applications, which allow developers to register multiple mini-grid sites under a single application. This will streamline processes, improve regulatory oversight, and benefit from economies of scale, ultimately reducing end-user tariffs for mini-grid projects.
NERC explained that adopting the AFUR mini-grid tariff tool is expected to bring regulatory consistency to the mini-grid subsector, making it easier for developers to operate across different jurisdictions. The tool rolled out across 30 African countries in the coming years, is designed to promote affordable and reliable electricity access by reducing end-user tariffs.
Starting Monday, December 16, 2024, NERC mandated that all mini-grid developers use the AFUR tariff tool to file permit applications with the Commission.
Mini-grids are small-scale, localised energy grids that provide electricity to specific communities, typically operating independently from the national grid. They often harness renewable energy sources such as solar, wind, hydro, and biomass. Mini-grids are seen as a solution to Nigeria’s power crisis, particularly given the frequent breakdowns of the national grid. The Rural Electrification Agency (REA) reported constructing about 103 mini-grids across Nigeria as part of the Nigeria Electrification Project (NEP).
If successfully implemented, adopting the AFUR tool is expected to strengthen the regulatory framework set out in the amended Mini-Grid Regulations 2023, foster growth in the renewable energy sector, and improve electricity supply across Nigeria.