Nigeria: Energy Expert Advises Governors to Domesticate Electricity Act

The energy expert advised governors to domesticate the electricity law and make tax break offers to encourage private sector investment in their states.

Nick Agule, an international oil and gas expert, has advised Nigerian governors to maximise the gains created by the unbundling of the electricity sector by domesticating the amended Act in their respective states.

Mr Agule further urged the governors to put in place a regulator - an equivalent of the National Electricity Regulatory Commission (NERC) for their states to regulate activities in the sector.

The energy expert made the advice on Wednesday while appearing as a guest on Focus Nigeria on AIT.

Former President Muhammadu Buhari last year signed into law 16 constitution alteration bills, which devolved more powers to the state by removing some items including railway, prison and electricity from the Exclusive Legislative List to the Concurrent List.

Before then, sub-national governments including Akwa Ibom State only own power stations but cannot transmit and distribute electricity as such powers were exclusively preserved for the federal government.

PREMIUM TIMES in 2016 reported how former Governor Udom Emmanuel of Akwa Ibom State lamented that despite being the only state in the country that could generate more than 150 megawatts of electricity, transmission was still an exclusive preserve of the federal government, the basis he said, residents were complaining of lack of power supply.

But the amended law allows states to license, generate, transmit and distribute electricity in areas covered by the national grid.

"The next step is for them (governors) to seek private sectors to come and invest by offering them sweet deals, to make things easy for them," Mr Agule said.

"A governor can say if you come in I will sign your Certificate of Occupancy today. I will give you some tax breaks. There is no state in Nigeria today that does not have abundant energy sources," he added.

How electricity can boost employment, revenue

The energy expert said that Nigeria is currently generating 3,000 megawatts of electricity shows that the country is not serious about power supply, adding that electricity is to the economy what blood is to the life of human beings.

"The economy will never lift up without electricity. So electricity should be the main target for governors. It is with electricity that businesses will begin to move.

"If you give electricity to this economy you will see that a lot of people will not depend on the government again because they can do it on their own, and then, the states and federal government will begin to take in more revenue from the taxation that is happening with them."

He said governments should give the same attention it gave to Covid-19 to electricity if it wants to solve the challenges of power supply in the country.

Break national grid monopoly

Mr Agule said the monopoly of having one national grid should be broken and likened it to putting all eggs in one basket, the basis he said was why when the nation goes down (experience darkness) once the national grid goes down.

He said other countries have micro grid, mini grid, and the national grid as against Nigeria which has only national grid.

"Talking about hydro, I have been to all the states in the southern part of Nigeria. There is no state that you will go to that you will not see a flowing body of water like a stream or a river near a community.

"Just dam (build a dam) it to get hydroelectricity for the communities around. You don't need to transmit it too far. Keep damming each river and supply to the communities around.

"Hydroelectricity comes off that. Irrigation comes off that. With irrigation you don't need to wait for rainfall again. You can create your rain twelve months a year and farmers will be busy. You can have fishing activity coming off that and you can also supply pipe borne water from that dam and also build a nice tourism resort.

"With localization of distribution and generation of electricity, it will eliminate the high cost of construction of the national grid," he said.

Some state governments, PREMIUM TIMES understands, had already secured power distribution licences from the federal government.

For instance, NERC in January last year approved an independent power distribution network known as Ibom Utility Company for Akwa Ibom to distribute electricity to selected locations in the state, Business Day reported.

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