Tag: NERC

The Utilities Consumers Rights Advocacy Initiative of Nigeria has faulted the assumption of office of the Abduallah Ramat, an engineer, as the Acting Chairman of Nigerian Electricity Regulatory Commission (NERC). pending proper Senate screening and confirmation as required by law. The Rights Group also has petitioned the  Attorney General of the Federation and Minister of Justice, Lateef Fagbemi.

The petition, signed by the Principal Partner of the group,  Akinbodunse Shadrack, described Ramat’s assumption of office as illegal.

The Advocacy group stressed that Ramat resumed duty without fulfilling the constitutionally and statutorily required process of Senate confirmation as stipulated under the Electricity Act, 2023. Ramat resumed as “Acting Chairman” of NERC on Friday, August 8, 2025.

In the petition, Shadrack referred to a statement issued from the official X (formerly Twitter) account of the Presidency on August 7, 2025, at 20:06, which initially announced Ramat’s resumption as Acting Chairman/CEO alongside two commissioners-designate.

He said, “However, in a subsequent clarification, the Presidency explicitly stated that the nominations of Ramat (Chairman-designate) and the two commissioners-designate remain subject to Senate confirmation.”

The group, therefore, expressed concern that Ramat proceeded to unilaterally assume office before Senate approval, a move that it argued raises serious questions over the legality of his actions and the validity of any decisions taken under his leadership.

Read Also: 10 things to know about 39-year-old new NERC chairman Ramat

He was emphatic that both press statements issued following the appointment were clear that the appointees should only resume office after Senate confirmation.

“Engr. Ramat’s assumption of the role of Chairman without Senate confirmation violates the statutory process outlined in Section 34(2) of the Electricity Act 2023, which requires nomination by the President and confirmation by the Senate. This makes his resumption both illegal and unconstitutional,” the petition read.

The group further argued that his action constitutes a breach of institutional integrity, warning that such disregard for due process at a regulatory body like NERC undermines investor confidence, weakens regulatory certainty, and threatens sectoral reforms.

Shadrack further explained that the illegal resumption sets a dangerous precedent for the Commission and insisted that any decisions taken by an “illegally constituted” leadership risk being invalid in law.

He warned, “The fallout from this illegal, improvident assumption of office could be disastrous for national development. Nigeria’s power sector requires stability, investor confidence, and professional regulation now more than ever.

“Instead, Engr. Ramat’s assumption of office without following due process is dangerous and threatens to negatively impact investor confidence in the already fragile electricity market.

“With billions of dollars on the line in ongoing generation and distribution projects, trust in the regulatory framework is paramount. This episode risks undoing reforms under the Electricity Act and deterring foreign and local investors,” he said.

The group, therefore, urged the Attorney General to review all decisions taken by Ramat, in his current capacity, is to reverse any actions taken beyond his authority.

He reiterated the importance of safeguarding the independence and integrity of regulatory institutions like NERC, stressing that strict adherence to legal procedures in leadership appointments is crucial to sustaining reforms and protecting the Nigerian power sector.

• ANED: Adopt fully funded subsidy schemes

The Nigerian Electricity Regulatory Commission (NERC) yesterday said since states have no jurisdiction over the national grid, they have no power to deviate from the tariff set for the energy supply from the grid.

NERC made its position known in a Public Notice on the “Application of Multiple Tariff Regimes in Nigerian Electricity Supply Industry.”

The public notice came on heels of the controversy following  the Enugu Electricity Regulatory Commission (EERC) reduction of tariff for the Band A customers in its franchise areas from N209 per kWh to N160/kWh.

While operators in the Nigerian Electricity Supply Industry (NESI) value chain, the electricity Distribution Companies (DisCos) and electricity Generation Companies (GenCos) have condemned the downward review. EERC said  it  based the rate crash on the sufficiency of the Federal Government subsidy.

NERC and the utility providers in NESI have however expressed fears that the other states’ electricity commissions might toe the line of EERC.

NERC, however noted that since “States do not have jurisdiction over the national grid and over electric power stations established under federal laws / operating under licences issued by the Commission, they must holistically incorporate the wholesale costs of grid supply to their states without any qualification or deviation in their design of tariffs for end-use customers in order not to distort the dynamics of the market, or be prepared to make a policy intervention by way of  subsidy or any deviation in the tariff structure that distorts the wholesale generation, transmission and legacy financing costs in NESI.”

In the public notice, NERC maintained that “the Tariff Order (Order No. EERC/2025/003) issued by the Enugu State Electricity Regulatory Commission (“EERC”) to its Licensee Mainpower Electricity Distribution Limited (“MEDL”)  that relies exclusively on electricity supply (generation and  transmission) from the national grid” is a major source of concern.  NESI stakeholders, according to NERC, have expressed concern about the consequences of the reduction of tariffs for Band A customers in MEDL’s network area to NGN160.4 per kWh and the freezing of tariffs of customers in the other bands on the wholesale generation and transmission costs along with the financing costs for legacy obligations in NESI.

NERC insisted that the N160.4/kWh was predicated on an assumption of N45.7/kWh subsidy payment.

“It is pertinent to state that the N160.4 per kWh was arrived at largely by reducing the current average Generation Tariff of N112.60 per kWh to NGN45.75, with an assumption of subsidy component, a difference of N66.85 per kWh, it said.

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Continuing, the commission said “Section 34(1) of the EA places a statutory obligation on the

Commission to “create, promote and preserve efficient electricity industry and market structures, and ensure the optimal utilization of resources for the provision of electricity” and we are also aware that

EERC as a sub-national electricity regulator, also has a similar statutory obligation in their enabling law; and neither NERC nor EERC, as responsible regulatory institutions would take decisions that expose the national grid and wholesale electricity market to a financial crisis in contravention of express powers granted to them by the Constitution.

“All stakeholders are advised to note that the Commission is currently engaging EERC on their tariff order as it relates to any perceived area of misinterpretation/misunderstanding on wholesale generation and transmission costs on their import of power from the national grid and grants further assurances of its unwavering statutory commitment that the electricity market will be made whole in terms of cost recovery in compliance with the laws of the Federal Republic of Nigeria.”

Yesterday, the electricity Distribution Companies (DisCos) called on state electricity regulators to adopt fully funded subsidy schemes. The DisCos, through their umbrella body as the Association of Nigeria Energy Distributors, Managing Director, Chief Sunday Oduntan, said in a press statement.

He urged the states to come up with timely disbursed subsidy payments for prompt settlement of market invoices and liquidity improvement.

He said, “A clear subsidy framework that is transparent, targeted, and fully funded.

“Timely disbursement of subsidy payments to enable prompt settlement of market invoices and improve market liquidity.”

Oduntan asked the states to pursue the subsidy payments in a manner that preserves the financial health of the market, encourages long-term investment, and avoids policies that could erode progress toward stable, reliable electricity for Nigerians

He said the recent tariff reduction by EERC  to N160/kWh for Band A customers in Enugu State, without adequate coordination with NERC and or other market participants raises significant concerns for the stability and liquidity of the Nigerian Electricity Supply Industry (NESI).

According to him, since the release of the Tariff Order by EERC for Enugu State residents, the DisCos in other States have come under intense pressure and scrutiny to also reduce tariffs, while some customers have taken a position that they will no longer pay their electricity bills until tariffs are reduced.

The statement reads in part: “Permit us to establish the fact that as service providers, it is our hope and desire that electricity tariffs at some point should begin to come down with time. It is not our intention to make life difficult for our loyal customers, and we have been aligning with the Federal Government to ensure provision of stable power supply.

“However, the cost reflective tariff is as a result of the economic realities of our nation.

“We note that one of the principles adopted by EERC is to place reliance on the Policy of the Federal Government on electricity subsidies to enable them crash Band A Tariffs. “While Discos are not opposed to subsidies in principle, we strongly emphasize that subsidies must be transparently structured and promptly funded. Delayed or unfunded subsidies create cashflow disruptions, undermine market confidence, and deepen the existing liquidity crisis across the electricity value chain.

“In a clear position, the Federal Government through the  Minister of Power, Chief Bayo Adelabu has stated that States slashing power tariff must be ready to pay subsidy, and be accountable for the financial implication.

“It is already a fact today that the delay in the prompt payment of electricity subsidies has put the generation companies and gas suppliers under severe operational burden due to the  almost N5 trillion outstanding to these market participants.

“It is important to stress that the Nigerian power market, in the short term, remains largely centrally coordinated, especially for Bulk energy purchases, Transmission, and market settlements involving Generation Companies (GenCos) and the Nigerian Bulk Electricity Trading Company (NBET).

“We duly recognise changes in law and regulation that now permits States to set up their electricity markets. However, any State-level policy action such as uncoordinated tariff reductions that does not align with market-wide cost-recovery mechanisms will inevitably result in shortfalls in Disco remittances to the market below their current Distribution

“Remittance Obligations, thereby putting GenCos and other upstream service providers at further financial risk.

We understand further that the Federal Government does not have an elastic subsidy budget.

“Any tariff reduction following the approach adopted by EERC may further bloat the subsidy obligations of the federal government.

“We believe that the Federal Ministry of Power and the Nigerian Electricity Regulatory Commission (NERC) would be watching closely to provide guidance and align State and Federal objectives to ensure electricity access is accelerated in a sustainable and affordable manner.

The above budgetary constraints apply to the States too. “Most cannot afford to make direct budgetary provisions for subsidies especially in the face of rising governance costs and the harsh operating environment,” the statement read.