Amendment attempts to 2023 Electricity Act may deter investors, expert warns 

Speaking on This Morning Show on Arise TV on Monday, Dr. Oyebanjo emphasized the significance of the 2023 Electricity Act in advancing Nigeria’s economic development and energy accessibility. “The Electricity Act has put Nigeria on the right path towards economic development, energy access, and it must not be allowed to be truncated,” he stated.

Dr. Oyebanjo stressed that policy instability could have far-reaching consequences for investment. “This is the kind of thing that makes investors not come to a country. Investors are watching, and when they see policy summersaults, they will refrain from coming to that country to invest,” he warned.

The 2023 Electricity Act, passed under the administration of President Bola Tinubu, empowers states to regulate and distribute electricity within their territories, breaking away from decades of centralized control. According to Dr. Oyebanjo, decentralization is a step in the right direction, allowing states to enforce technical standards and tailor energy solutions to their unique needs.

“To be sure, the decision to decentralize and devolve powers to the states is the correct one. It has been there since 1979. Somebody cleverly removed it in the 1999 Constitution. Now, we have gone back to it after 40 years. So, it’s not good for anybody to truncate it,” he said.

Recently, the Forum of State Commissioners of Power and Energy, representing the 36 state commissioners, has strongly opposed the proposed amendment, which seeks to empower the Nigerian Electricity Management Services Agency (NEMSA) as the sole regulator of electricity.

Nigeria’s power sector has long been plagued by inefficiencies, underinvestment, and unreliable supply. The 2023 Electricity Act was widely regarded as a landmark reform, intended to attract private investment and improve service delivery by decentralizing power management.

As debates continue, experts and stakeholders have urged caution, warning that policy reversals could send negative signals to both local and international investors. With Nigeria aiming to transform its power sector to boost economic growth, stability in regulatory frameworks remains critical.

Recently, the Federal Government, through the Nigerian Electricity Regulatory Commission (NERC), has announced the transfer of regulatory oversight of the electricity market in Lagos State to the newly established Lagos State Electricity Regulatory Commission (LASERC).

This transfer follows a comprehensive process that aligns with the requirements outlined in the Electricity Act 2023, which allows states to assume regulatory control over their intrastate electricity markets, provided they notify the NERC and meet the necessary conditions.