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By Oke Epia, E-mail: sostainability01@gmail.com | WhatsApp: +234 8034000706
Trends and Threads
By Mmachi Okafor
Nigeria’s efforts to strengthen its renewable power sector might take a major flip with the proposed Electricity Act (Amendment) Bill, 2025, which seeks to determine a devoted regulatory authority liable for overseeing the event, promotion, and utilisation of renewable power assets throughout the nation.
Sponsored by Hon. Afam Victor Ogene, the invoice proposes amendments to the Electricity Act, 2023, with the first purpose of restructuring the regulatory framework governing renewable power technology, distribution, funding and consumption in Nigeria.
At the centre of the proposed laws is the institution of the National Authority for Renewable Energy (NARE), an impartial regulatory establishment that will assume key obligations at the moment assigned to the Nigerian Electricity Regulatory Commission (NERC), the Rural Electrification Agency (REA) and the Rural Electrification Fund (REF).
The invoice seeks to centralise regulatory and supervisory obligations referring to renewable power beneath a single establishment, making a extra coordinated framework for the event and utilisation of renewable power assets.
The scope of the proposed laws extends past electrical energy technology to incorporate renewable power infrastructure improvement, licensing, distribution, funding promotion, technological innovation, client safety, rural electrification and the institution of regulatory requirements.
Under the proposed framework, NARE would oversee actions involving renewable power applied sciences reminiscent of photo voltaic, wind, hydro, geothermal, biomass, hydrogen, tidal and wave power. The authority would additionally promote analysis into rising applied sciences and set up technical requirements to assist the environment friendly technology and utilisation of renewable power.
A serious element of the invoice is its emphasis on increasing electrical energy entry to underserved and unserved communities, notably in rural areas the place insufficient energy infrastructure continues to restrict financial alternatives and social improvement.
To tackle this problem, the laws proposes the promotion and implementation of mini-grid and off-grid renewable power techniques in distant communities, islands, and different areas with restricted entry to traditional electrical energy networks.
The proposed enlargement of decentralised electrical energy infrastructure is meant to enhance entry to energy whereas encouraging the productive use of renewable power in communities which have traditionally remained exterior the attain of dependable electrical energy companies.
The invoice additionally identifies bioenergy know-how as an necessary element of rural electrification, reflecting its broader goal of diversifying Nigeria’s power sources and decreasing extreme dependence on typical electrical energy technology.
Beyond increasing electrical energy entry, the proposed laws seeks to create a beneficial funding setting able to attracting private-sector participation in renewable power improvement.
It empowers the proposed authority to facilitate monetary, fiscal, regulatory and risk-sharing incentives for native producers of renewable power merchandise. These measures are meant to encourage home manufacturing, stimulate funding and assist the expansion of renewable power companies.
The laws additional offers for collaboration between NARE and the Federal Ministry liable for Finance to introduce tax incentives and reduction measures that will encourage renewable power technology, consumption and mission implementation.
Such incentives might assist scale back monetary obstacles going through renewable power builders, though their effectiveness would rely on the particular fiscal insurance policies adopted and the consistency of their implementation.
Another important goal of the invoice is to determine a structured regulatory setting for renewable power operators and shoppers.
Under the proposed association, NARE could be liable for licensing and regulating people and organisations engaged in renewable power technology, distribution, provide and buying and selling. It would additionally approve initiatives, set up working codes, monitor compliance and resolve disputes inside the business.
The authority would have powers to implement regulatory requirements, examine licensed amenities and impose sanctions for violations of operational necessities.
These provisions are meant to advertise accountability, enhance service supply and be sure that renewable power actions function inside a longtime authorized and institutional framework.
Consumer safety additionally varieties an necessary a part of the laws. The invoice proposes the institution of acceptable client rights and obligations whereas requiring renewable power pricing and tariffs to be honest and balanced for shoppers, traders, licensees and different stakeholders.
This strategy seeks to steadiness the business pursuits of renewable power traders with the necessity to make electrical energy companies accessible and reasonably priced to shoppers.
The proposed laws additionally recognises the significance of coordination between renewable power regulators and present electrical energy establishments.
Although NARE would assume main obligations for renewable power regulation, the invoice offers for collaboration with NERC on regulatory requirements, licensing procedures, grid connections, energy buy agreements, tariffs, coverage improvement and dispute decision.
This association is meant to assist the mixing of renewable electrical energy into Nigeria’s wider energy system whereas sustaining coordination between the proposed renewable power authority and present electricity-sector establishments.
However, the success of this framework would rely on clearly outlined obligations and efficient cooperation between the establishments to stop overlapping mandates, regulatory uncertainty and administrative delays.
A very important provision of the invoice considerations the financing of the proposed authority.
The laws seeks to allocate 40 per cent of the Rural Electrification Fund’s annual assets to NARE for renewable power improvement and related actions. It additionally identifies licensing charges, expenses, National Assembly allocations and different lawful sources of earnings as potential funding channels for the authority.
This proposed funding association is designed to offer monetary assets for renewable power programmes, infrastructure improvement and regulatory operations.
Nevertheless, transferring a considerable proportion of the Rural Electrification Fund to a brand new establishment raises necessary questions in regards to the monetary implications for present rural electrification programmes and the necessity to make sure that assets proceed to succeed in communities requiring electrical energy entry.
The invoice additionally offers for the institution of a governing board liable for overseeing the authority’s insurance policies, funds and institutional administration.
The proposed board would come with representatives from Nigeria’s six geopolitical zones, related federal ministries, the Central Bank of Nigeria, the Renewable Energy Association of Nigeria and Women in Renewable Energy.
The inclusion of those stakeholders displays an intention to advertise broader institutional participation in renewable power governance.
Furthermore, the laws seeks to encourage gender mainstreaming and native content material improvement inside the renewable power business.
These provisions might create alternatives for higher participation by ladies, indigenous companies, technical professionals and native producers within the increasing renewable power market.
Research, innovation and capability constructing additionally characteristic prominently among the many invoice’s targets.
The proposed authority could be liable for selling analysis into renewable power applied sciences, supporting infrastructure improvement, establishing technical requirements and implementing programmes aligned with worldwide finest practices.
By encouraging technological development and abilities improvement, the invoice seeks to strengthen Nigeria’s capability to develop and utilise renewable power assets whereas supporting the emergence of a extra aggressive home renewable power business.
Public training is one other necessary facet of the proposed laws. NARE could be anticipated to advertise consciousness of renewable power manufacturing and consumption, serving to people, communities and companies perceive the alternatives related to different power applied sciences.
The invoice additionally extends its consideration to renewable power initiatives past electrical energy technology, offering a broader framework for the productive utilisation of renewable power assets throughout completely different sectors of the financial system.
From an financial improvement perspective, the laws presents alternatives to assist funding, increase power infrastructure, stimulate native manufacturing and enhance electrical energy entry for companies and households.
Reliable renewable electrical energy might assist small companies, agricultural processing, healthcare amenities, instructional establishments and different financial actions, notably in communities the place insufficient energy provide stays a significant impediment to improvement.
However, these potential advantages would rely on the profitable implementation of the proposed regulatory reforms, sufficient financing, clear mission administration and efficient coordination amongst related authorities businesses.
The invoice’s central goal is due to this fact not merely to advertise renewable power adoption however to restructure the establishments liable for regulating and growing the sector.
By proposing a devoted nationwide authority, the laws seeks to determine a extra coordinated system for renewable power governance, strengthen regulatory oversight, encourage funding, increase electrical energy entry and promote the sustainable utilisation of Nigeria’s renewable power assets.
Nevertheless, the proposal raises necessary coverage questions on whether or not creating one other regulatory establishment would enhance effectivity or introduce further administrative prices and institutional complexities.
The switch of obligations from established electricity-sector businesses would require cautious administration to make sure continuity in present programmes, forestall duplication of capabilities and defend investments already dedicated to renewable power improvement.
Ultimately, the Electricity Act (Amendment) Bill, 2025, represents a proposed institutional reform geared toward strengthening Nigeria’s renewable power sector by way of centralised regulation, funding incentives, technological improvement and expanded electrical energy entry.
Its potential contribution to financial development and sustainable improvement would rely not solely on the institution of NARE but in addition on the effectiveness of its regulatory framework, the transparency of its funding preparations and its means to translate legislative targets into measurable enhancements in electrical energy entry.
For Nigeria, the place electrical energy shortages proceed to constrain productiveness and financial alternatives, the importance of the proposed laws lies in whether or not its institutional reforms can ship dependable, reasonably priced and sustainable power to households, companies and communities throughout the nation.
