By Milcah Tanimu
As Nigeria grapples with rising anger over a 240% power tariff hike, twelve states including Lagos, Kano, and others have set plans in motion to initiate power generation projects within their territories. This move aligns with the Electricity Act of 2023, which grants states the authority to generate, transmit, and distribute electricity independently.
In response to the tariff hike, various groups including the Petroleum and Natural Gas Senior Staff Associations of Nigeria and civil society organizations have criticized the government’s decision, warning of worsening conditions for Nigerians.
Under the new Electricity Act signed into law by President Bola Tinubu in June 2023, states are empowered to establish their electricity generation firms, promoting private sector investments in the power sector. This legislation allows for the regulation of electricity markets within states, paving the way for independent regulatory bodies.
It has been disclosed that twelve states have already applied for independence in regulating their electricity markets, signaling a significant shift from federal oversight. Once established, these state regulatory commissions will assume responsibility for regulating electricity businesses within their jurisdictions.
Several states have made strides towards implementing their power projects. Lagos, for instance, has been at the forefront of unbundling power generation and distribution systems, with plans to generate electricity independently. Similarly, Ekiti State has already commenced its Independent Power Project, supplying electricity to various government establishments and businesses.
However, challenges such as funding and technical aspects remain obstacles for some states. Osun State, for example, is seeking support from the World Bank and private investors to kickstart its power generation initiatives.
Despite the enthusiasm shown by states to address electricity challenges locally, concerns persist over the timing and impact of the tariff hike. Various stakeholders have condemned the hike as oppressive and ill-timed, warning of potential industrial unrest. They argue that the hike exacerbates the burdens faced by Nigerians, especially in the absence of improved electricity supply.
As states forge ahead with their power projects, the government faces mounting pressure to address the grievances of the populace and ensure equitable access to electricity while balancing the need for sustainable economic policies.
