Nigeria is ushering in a new era of energy management as the Nigerian Electricity Regulatory Commission (NERC) hands over regulatory control of electricity markets to individual states. This shift empowers states like Lagos, Rivers, Kano, and Ogun to address their unique energy needs more effectively.
These states aim to reduce outages, attract investments, and foster economic growth by managing their power supply. This decentralisation ought to reshape Nigeria’s electricity sector and improve the daily lives of millions.
Lagos State
Lagos State, Nigeria’s economic hub, is at the forefront of this regulatory shift. The newly established Lagos State Electricity Regulatory Commission (LASERC) oversees the electricity market. With its dense population and vibrant economy, Lagos has one of the highest energy demands in the country. According to the Nigeria Residential Energy Demand-Side Survey Report 2024, Lagos accounts for approximately 15% of the national electricity demand. LASERC aims to address the city’s unique energy challenges by ensuring a more reliable and efficient power supply.
Rivers State
Rivers State, home to Nigeria’s vital oil and gas industry, is another key player in this regulatory transformation. The operations of numerous oil companies and associated industries drive the state’s energy demand. Rivers State accounts for around 12% of the national electricity demand. By assuming regulatory control, Rivers State can optimise its energy consumption, reduce wastage, and ensure a stable power supply for its critical industrial activities.
Kano State
Kano, the commercial nerve centre of Northern Nigeria, is also taking charge of its electricity market. With its extensive industrial base and significant energy demand, Kano State’s focus on enhancing its power infrastructure is crucial. Kano accounts for approximately 10% of the national electricity demand. The state aims to support industrial growth, boost productivity, and create a more conducive environment for business operations. By managing its energy needs autonomously.
Ogun State
Ogun State, strategically located near Lagos, benefits from the spillover effects of Lagos’s economic activities. The state’s rapid industrialisation has led to a substantial increase in energy consumption. Ogun State accounts for around 8% of the national electricity demand. By assuming regulatory control, Ogun State aims to expand its power infrastructure and ensure a stable and reliable energy supply to support its growing industries and residential areas.
Federal Capital Territory (Abuja)
Although not a state, Abuja, the Federal Capital Territory (FCT), has also seen significant developments in its energy sector. As Nigeria’s political and administrative capital, Abuja has a high energy demand driven by government offices, residential areas, and a burgeoning commercial sector. Abuja accounts for approximately 7% of the national electricity demand.
Ademola Agoro, Vice-President of the Nigerian Society of Engineers (NSE), views this decentralisation as essential to stimulate investments and allow each state to grow at its own pace in addressing power supply challenges. With the national grid’s shortcomings and inadequate investments in transmission infrastructure, decentralisation offers a more tailored approach to local energy needs.
The decentralisation of energy regulation in Nigeria marks a pivotal moment in the country’s journey toward a more efficient and sustainable power sector. Nigeria is addressing local energy needs more effectively and fostering economic growth by empowering states like Lagos, Rivers, Kano, and Ogun to manage their electricity markets.
As these states take charge of their energy futures, the collective efforts will contribute to a more stable and reliable power supply, benefiting the economy and enhancing the quality of life for millions of Nigerians. With continued investment and innovation, Nigeria’s energy landscape is set for a transformative change that promises a brighter and more sustainable future.