Abuja – The Forum of Commissioners of Power and Energy in Nigeria (FOCPEN) wishes to express profound surprise and concern regarding the proposed Electricity Act (Amendment) Bill, 2025, currently undergoing deliberation in the Nigerian Senate. This unexpected legislative move comes barely two years after the landmark Electricity Act 2023 was signed into law, and a period during which many States have only just begun to establish and operationalize their electricity markets under the new decentralized framework. More than 16 States have passed their electricity laws since the enactment of the Electricity Act in 2023 by President Bola Ahmed Tinubu, GCFR.
FOCPEN notes with dismay the absence of any prior consultations with state governments, or their relevant commissioners and state electricity regulatory bodies, during the drafting and presentation of this crucial amendment bill on the floor of the Senate. This oversight is particularly concerning given the significant strides made in decentralizing Nigeria’s electricity sector.
The Electricity Act 2023 stands as a signature achievement of President Bola Ahmed Tinubu’s administration. Its enactment followed the groundbreaking fifth alteration to the 1999 Constitution of the Federal Republic of Nigeria, which decisively removed all ambiguities regarding the ability of States to make laws and regulate electricity markets within their territories. This transformative legislation has since catalyzed a wave of reform, empowering sub-national governments to drive electricity development within their territories, attract local and international investments, and address the unique power needs of their citizens.
It is therefore surprising that within two years of its passage, the Electricity Act 2023 is now subjected to a sweeping amendment of key provisions of the Act, without any consultation whatsoever with State governments or their regulatory institutions.
This unilateral approach undermines the spirit of cooperative federalism and threatens to reverse the gains made in decentralizing Nigeria’s electricity sector. It will be recalled that it took 18 years for the National Assembly to amend / repeal the Electric Power Sector Reform Act (EPSRA) passed in 2005, under President Olusegun Obasanjo, GCFR.
After a thorough review of the proposed amendments, FOCPEN issues the following statements relating to the amendment bill:
1. Unconstitutional Overreach and Backdoor Constitutional Amendment:
The proposed Electricity Act (Amendment) Bill, 2025, is an attempt at a “backdoor amendment” of the 1999 Constitution of the Federal Republic of Nigeria (as amended) by seeking to reintroduce constraints and ambiguities that were expressly removed by the fifth alteration of the Constitution. In addition, several provisions of the amendment bill egregiously violate foundational principles of true constitutional federalism, and threaten the successful implementation of a decentralized electricity market.
Notably:
– Amended Section 2 introduces a “non-conflict” clause that subordinates State laws to federal provisions, even within intra-state electricity markets.
– Amended Section 230 and new Sections 230A–C impose rigid timelines and conditions on States, effectively allowing NERC to retain overriding authority, even in areas where States have exclusive jurisdiction.
The amendment bill, if passed, will create a constitutional conflict between the Federal Government and States, as well as legal and regulatory conflicts between federal and state regulators, undermining the principle of cooperative federalism and potentially inviting judicial challenges.
2. Entrenchment of Unsustainable Electricity Subsidies:
At a time when the administration of President Bola Ahmed Tinubu is striving to end unsustainable and wasteful energy subsidies, the electricity amendment bill 2025 surprisingly seeks to entrench a subsidy regime in the power sector. It should be noted that electricity subsidies gulped N1.94 trillion in 2024 alone! The total accrued electricity subsidies of more than N5 trillion remain unpaid, crippling the power sector and making it unviable for private sector investments. The amendment bill, if passed, will further exacerbate the financial burden on the federal government and States, undermining efforts to achieve a sustainable and self-financing power sector.
3. Increased Burden on Electricity Customers:
The amendment bill proposes the creation of numerous federal institutions, agencies and Funds, whose operational and administrative costs are to be directly passed on to electricity consumers, thus resulting in higher electricity tariffs for consumers. The imposition of additional financial burden on electricity customers already struggling with high electricity tariffs for Band A service is unacceptable, especially when States are actively pursuing cost-reflective tariffs tied to improved quality of service.
In addition, the bill specifies mandatory contributions from consumers and market participants to fund the Power Consumer Assistance Fund (PCAF). Consumers, including those in States with cost-reflective tariffs, would bear the cost of subsidies through tariff surcharges, even in the face of widespread non-payment and market losses. By this provision, the amendment bill would also transfer over ₦5 trillion in unpaid subsidies to electricity consumers, worsening affordability and equity in electricity access.
4. Create Regulatory Conflicts & Risks:
The amendment bill, if passed, will create policy, legal and regulatory conflicts between Federal and State Agencies / regulators, significantly increasing regulatory uncertainty and risks for both federal and state-level investors in The Electricity Market. The bill will further exacerbate administrative bottlenecks in the power sector by:
– Undermining the autonomy of State electricity regulators.
– Creating overlapping jurisdictions and unclear regulatory boundaries.
– Imposing new levies and compliance burdens on market participants within state electricity markets, thus raising the cost of doing business in the power sector.
–. Creating conflicting mandates and diluting accountability.
Inevitably, the amendment bill will hinder public and private sector investments particularly in State electricity markets, and stall the momentum of recent reforms by President Bola Ahmed Tinubu in the power sector.
5. Undermines the Exclusive Constitutional Jurisdiction of States over Electricity Distribution within their Territories:
The bill seeks to bestow upon NERC an overriding regulatory jurisdiction over electricity distribution, electricity distribution tariff design and implementation, and consumer protection within State electricity markets and centralize the regulation and enforcement of technical standards within states electricity markets under the NEMSA. These provisions contravene sections 13 and 14 of the second schedule of the 1999 Constitution (as amended) and undermine the constitutional powers of States’ Legislatures to make laws for electricity distribution within their territories. By virtue of the 5th alteration to the 1999 constitution (as amended) and the Electricity Act 2023, States have exclusive constitutional and regulatory jurisdiction over electricity distribution, whether connected, reliant or not connected to the national grid, within their territories.
6. Lack of Stakeholder Engagement:
The total lack of engagement and consultation with States, who are now primary drivers of electricity sector development, in the drafting of this amendment bill is a serious concern. Effective and sustainable reforms require collaborative efforts between federal and sub-national governments.
7. Undermining Transformational Progress in the Power Sector:
The amendment bill threatens to dismantle the progress and positive reforms initiated by the Electricity Act 2023, which has been widely hailed as a pivotal step towards a more reliable and efficient power sector. This untimely amendment risks undermining President Bola Ahmed Tinubu’s key policy achievements in the energy sector.
Conclusion:
FOCPEN firmly believes that this is not the opportune time for an amendment to the Electricity Act 2023, as the Act is still in its early implementation phase. In addition, several States have commenced the process to operationalize their electricity laws and create viable state electricity markets. In this regard, the Forum calls on the National Assembly to halt further consideration of the bill.
Noting that Electricity is a Concurrent legislative matter under the 1999 Constitution, the Forum advocates that any future considerations for an amendment of the Electricity Act 2023, must be preceded by broad-based consultation and collaboration with state governments to ensure that federal legislation complements, rather than undermines, nascent state electricity markets.
The Forum of Commissioners of Power and Energy in Nigeria holds the National Assembly in high esteem and remains committed to working with all stakeholders, including the Nigerian Senate, to foster a robust, constitutionally compliant, and financially viable electricity sector that serves the best interests of all Nigerians. We reiterate that the Electricity Act 2023, as currently enacted, provides the necessary framework for achieving these objectives.
Yours sincerely,
Prince Eka Williams,
Commissioner of Power and Renewable Energy, Cross River State Chairman, Forum of Commissioners of Power and Energy in Nigeria ekawilz@gmail.com
0803 708 6231
Barr. Omale Omale
Commissioner of Power, Renewable Energy and Transport, Benue State Secretary, Forum of Commissioners of Power and Energy in Nigeria omaleoga@gmail.com
0803 491 5655
