NERC Seeks Reallocation of Rural Electrification Fund to Industries, Others

The Nigerian Electricity Regulatory Commission (NERC) is seeking the reallocation of the $2 billion currently domiciled with the Rural Electrification Agency (REA) beyond rural use to include industries and other large-scale needs.

The Vice Chairman of NERC, Mr Musiliu Oseni, called for a policy rethink in the management and utilisation of the REA fund, saying Nigeria must go beyond powering homes to powering industries and national prosperity.

Mr Oseni, speaking during the Technical Sessions to mark NERC’s 20th Anniversary in Abuja, said the commission’s focus has now shifted toward unlocking private capital, particularly in the transmission sub-sector, through the newly established Transmission Infrastructure Fund (TIF).

“Through effective regulation, we have saved the Federal Government several trillions of naira in subsidies, strengthened market reliability, and enhanced consumer protection,” he said.

The REA fund is part of efforts address Nigeria’s electricity access gaps. It was established for the purpose of supporting rural and underserved electrification. The fund provides capital subsidies or grants to schemes that can help achieve the electrification goal.

According to Mr Oseni, transmission remains a challenge beyond generation and distribution.

“But now we must move from subsidy savings to investment stimulation. That is why our attention is on transmission, the weakest link in the electricity value chain.“

The NERC Vice Chairman explained that the TIF will provide a financing platform to attract both local and international investors into Nigeria’s transmission grid, thereby enhancing stability and capacity for industrial growth.

On the management of the Rural Electrification Fund, Mr Oseni urged the federal government to deploy part of the $2 billion fund toward large-scale industrial and commercial power supply.

“You can power access through mini-grids, but you can’t power your economy to prosperity,” he said pointedly.

“We must ensure that access translates to productivity, and productivity translates to jobs and growth,” he added.