2023 was that year when it became very glaring that there is indeed no going back when it comes to States creating their respective electricity markets in Nigeria. It started with the amendment of the Constitution then to the enactment of the Electricity Act, 2023 (as amended) [the “Act”]. These legislative documents were indeed crucial in achieving the ongoing reform that the Nigeria Electricity Supply Industry (“NESI”) is experiencing. A major part of this reform is where States will enact their Electricity Law, issue a notification to the Nigerian Electricity Regulatory Commission (“NERC”) to commence the transition and NERC in turn will issue an Order for the transfer of regulatory powers to the State, effectively recognizing the transition to the State Electricity Market. As it impacts participants and stakeholders in the NESI has been much debated. However, with respect to participants, particularly licensees, transitioning doesn’t happen in a vacuum as certain work streams are crucial to ensure seamless operations and sustain a robust governance structure. Given the position of DisCos in the NESI, we consider them the most impacted by the transition as 60% of the regulations in NESI is DisCo focused. To ensure that DisCos can weather any storm that the transition process will bring about, we have in this write up shared some guide on how to navigate certain workstreams during the transition process and as well, establish a corporate structure that strengthens the governance outlook of the DisCo.
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