ELECTRICITY ACT, 2023

ELECTRICITY ACT, 2023

LAWS OF THE FEDERATION OF NIGERIA

ARRANGEMENT OF SECTIONS

PART I — PRELIMINARY PROVISIONS

1.     Objectives of the Act

2.     Application and scope of the Act

PART II — NATIONAL INTEGRATED ELECTRICITY POLICY AND STRATEGIC IMPLEMENTATION PLAN

3.     National Integrated Electricity Policy and Strategic Implementation Plan

4.     Periodic review of the National Integrated Electricity Policy

5.     Supervisory powers of the Minister and functions of the Ministry responsible for Power

PART III — DEVELOPMENT OF A COMPETITIVE NATIONAL ELECTRICITY MARKET

6.     Legal validity of pre-privatization and post-privatization

7.     Competition during the post-privatization stage

8.     Declaration of competitive electricity markets

9.     Sale and purchase of electricity and ancillary services

10.    Market rules and grid code

11.    Commission’s directive respecting eligible customers

12.    Commission’s directive respecting competition transition charges

13.    Commission’s determination respecting competition transition charges

14.    Public hearing respecting competition transition charges

PART IV — INCORPORATION AND LICENSING OF ISO

15.    Incorporation and licensing of the ISO

16.    Subscribers to the constitutional documents of the ISO and its objects

17.    Functions of the ISO

18.    Engagement of technical support

19.    Transfer of employees, assets, and liabilities

20.    Conclusive evidence

21.    Enforcement or continuation of any cause of action or proceedings

22.    Limitation of action against ISO

23.    Release from liability or obligation

24.    Guarantee or surety

25.    Provision of records to the ISO

26.    Further order amending a transfer order.

27.    Directions to the TCN on matters related to transition

28.    Transfer of employees to the ISO

29.    Exemption from stamp duty or other charges

30.    Composition and appointment of the Board of the ISO

31.    Term of office of members of the Board

32.    Protection of land belonging to the ISO

PART V — ESTABLISHMENT, FUNCTIONS AND POWERS OF THE NIGERIAN ELECTRICITY REGULATORY COMMISSION

33.    Establishment of the Nigerian Electricity Regulatory Commission

34.    Functions and powers of the Commission

35.    Appointment of Commissioners

36.    Terms of office and conditions of service of Commissioners

37.    Conditions for appointment of Commissioners

38.    Vacation of office by Commissioner

39.    Dismissal and suspension of Commissioner

40.    Filling of vacancies in the Commission    

41.    Chairman and Vice Chairman of the Commission

42.    Meetings and procedure of the Commission

43.    Remuneration and expenses of Commissioners

44.    Commissioners to disclose certain connections and interests

45.    No invalidity of decisions and acts of the Commission

46.    Proceedings of the Commission

47.    Decisions and orders of the Commission

48.    Commission to give notice to interested parties

49.    Commission to consult experts on technical questions

50.    Question of law may be referred to the Federal High Court

51.    Rehearing and appeals

52.    Annual programmes and budgets of the Commission

53.    Funds of the Commission

54.    Surplus funds of the Commission

55.    The financial year of the Commission

56.    Accounts of the Commission

58.    Powers of the auditors

59.    Execution of contracts and instruments by the Commission

60.    Reports of the Commission

61.    Staff of the Commission

62.    Exemption from Liability for the Commission

PART VI — LICENSING

63.    Authorised persons to generate and transmit electricity

64.    General duties of licensee

65.    General licenses

66.    Transmission licenses

67.    System operation license

68.    Distribution and supply licensees

69.    Trading licenses

70.    Restriction on licenses

71.    Application and procedure for license

72.    Terms and Conditions of licenses

73.    Removal of licensees

74.    Amendment of licenses

75.    Intervention powers in failing licensees

76.    Enforcement of license

77.    Sale of undertakings of licenses

78.    Vesting of undertaking in the purchaser

79.    Provision where no purchase takes place

PART VII — GENERATION OF ELECTRICITY

80.    Promotion of generation from renewable energy

81.    Directions to generation companies

PART VIII — ESTABLISHMENT OF THE NATIONAL HYDROELECTRIC POWER PRODUCING AREAS DEVELOPMENT COMMISSION

82.    Establishment of the National Hydroelectric Power Producing Area Development Commission

83.    Headquarters of the N-HYPPADEC

84.    Establishment, membership and powers of the Governing Council

85.    Supplementary provisions relating to the Council

86.    Power of the Council

87.    Tenure of office of members of the Council

88.    Cessation of office

89.    Functions of the N-HYPPADEC

90.    Establishment of Directorates of the N-HYPPADEC

91.    Management Committee

92.    Advisory Committee

93.    Appointment of the Managing Director

94.    Pension matters

95.    Fund of the N-HYPPADEC

96.    Expenditure of the N-HYPPADEC

97.    Powers to accept gifts

98.    Borrowing power

99.    Annual estimates and expenditure

100.  Quarterly report

101.  Annual report

102.  Establishment of the Monitoring Committee

103.  Office premises of the N-HYPPADEC

104.  Directives by the President

105.  Limitation of suits against the N-HYPPADEC

106.  Notice of summons

107.  Indemnity

PART IX — TRANSMISSION OF ELECTRICITY

108.  Demarcation of transmission into National Control Centre

109.  Private sector investment in transmission network

110.  Fair spread of private sector investment in transmission network

111.  Commission to issue directives to the transmission licensee

112.  Public and private partnerships to facilitate transmission of electricity within a State

PART X — DISTRIBUTION AND SUPPLY OF ELECTRICITY

113.  Distribution and Supply Network and Renewable Energy

114.  Installation of meters

115   Disconnection of supply in default of payment

PART XI — TARIFFS AND SUBSIDIES

116.  Activities subject to tariff regulation

117.  Provision of electricity subsidy by government

PART XII — ACQUISITION OF LAND AND ACCESS TO LAND

118.  Procedure for acquisition of land and land access rights for electricity projects

PART XIII — CONSUMER PROTECTION AND LICENSEE PERFORMANCE STANDARDS

119.  Consumer protection standards

120.  Performance standards and codes

PART XIV — COMPETITION AND MARKET POWER

121.  Competition and market power

PART XV — THE POWER CONSUMER ASSISTANCE FUND

122.  Establishment of the Power Consumer Assistance Fund

123.  Contribution rates for the PCAF

124.  Contribution payments for the PCAF

125.  Payments from the PCAF

126.  Fine for non-payment of money owed

PART XVI — RURAL ELECTRIFICATION AGENCY

127.  Establishment of the Rural Electrification Agency

128.  Objectives of the Agency

129.  Functions and powers of the Agency

130.  Establishment and composition of the Governing Board of the Agency

131.  Tenure of members of the Board

132.  Cessation of membership of the Board

133.  Allowances of the Chairman and Non-Executive members of the Board

134.  Powers of the Board

135.  Meeting and proceedings of the Board

136.  Secretary of the Board

137.  Managing Director and chief executive officer of the Agency

138.  Other staff of the Agency

139.  Pension and gratuity

140.  Structure of the Agency

141.  Functions of Executive Directors and Directorates of the Agency

142.  Establishment of the Rural Electrification Fund

143.  Purpose of the REF

144.  Management of the REF

145.  Contribution rates for the REF

146.  Contribution payment for REF

147.  Criteria for allocation

148.  Fine for non-payment of amount owed

149.  Expenditure of the Agency

150.  Exemption from income tax

151.  Supervisory powers of the Minister

152.  States Rural Electrification Boards and Local Government Rural Electrification Committees

153.  Relationship between the Agency and State Rural Electrification Boards

154.  Progress reports

155.  Monitoring of rural electrification projects

156.  Power to accept gifts

157.  Power to borrow 

158.  Estimates of the Agency

159.  Accounts and audits

160.  Annual report

161.  Limitation of suits against the Agency

162.  Restriction on execution of suits against the property of the Agency

163.  Indemnity

PART XVII — RENEWABLE ENERGY AND ENERGY EFFICIENCY

164.  Communication to promote the development and utilization of renewable energy

165.  Commercial activities for renewable energy

166.  Renewable energy incentives and standards

167.  Considerations for renewable purchase obligation

168.  Feed-in tariffs rates

169.  Approval of feed-in tariffs rates

170.  Publication of feed-in tariff rates

171.  Connection to transmission and distribution systems

PART XVIII — NIGERIAN ELECTRICITY MANAGEMENT SERVICES AGENCY

172.  Establishment of Nigerian Electricity Management Services Agency

173.  Establishment and membership of the Governing Board

174.  Tenure of office

175.  Powers of the Governing Board

176.  Objectives and functions of the NEMSA

177.  Appointment of the Managing Director and chief executive officer and other staff of the NEMSA

178.  Service to be subject to the Pension Reform Act

179.  Funds of the NEMSA

180.  Annual report

181.  Access to premises and other enforcement powers

182.  Supervisory powers of the Minister

183.  Regulations

184.  General provisions

PART XIX — NATIONAL POWER TRAINING INSTITUTE OF NIGERIA

185.  Establishment of the National Power Training Institute of Nigeria

186.  Functions and powers of the Institute

187.  Establishment and membership of the Governing Council

188.  Functions of the Council of the Institute

189.  Tenure of members of the Council of the Institute

190.  Cessation of membership of the Council of the Institute

191.  Allowances of the Chairman and members of the Council of the Institute

192.  Filling of vacancies in the Council of the Institute

193.  The Director-General and other staff of the Institute

194.  The Secretary of the Council

195.  Academic Board of the Institute

196.  Functions and powers of the Academic Board

197.  Composition of the Academic Board

198.  Financial statement, annual budget and estimates

199.  Annual report of the Institute

200.  Fund of the Institute

201.  Expenditure of the Institute

202.  Establishment of the Power Training Fund

203.  Utilization of the Power Training Fund

204.  Exemption of Funds from income tax

205.  Supervisory powers of the Minister

206.  Limitation of suits against the Institute

207.  Power to make regulations

PART XX — OFFENCES AND PENALTIES

208.  Theft of electricity

209.  Theft of electric lines and materials

210.  Offence of receiving stolen electricity

211.  Interference with meters or works of licensees

212. Negligently breaking or damaging electricity materials

213.  Intentionally disrupting power supply

214.  Offence relating to damage to public streetlights

215.  Contravention of regulations or orders

216.  False declaration

217.  Offences by companies

218.  Abetment

219.  Unlawful use of information by inspector

220.  Obstruction, impersonation

221.  Power to prosecute

222.  Power to compound offences

223.  Jurisdiction to try offences

PART XXI — MISCELLANEOUS AND SUPPLEMENTARY PROVISIONS

224.  Exemption of electric plants from attachment in certain cases

225.  Power of the licensee to enter premises and to remove fittings or other apparatuses of the licensee

226.  Power of the Commission to make regulations

227.  Local content in the power sector

228.  Protection of investments in the power sector

229.  Functions of the Council

PART XXIII —FINAL PROVISIONS

230.  Consequential and transitional provisions

231.  Repeal and Savings provisions

232.  Interpretation

233.  Citation

ELECTRICITY ACT, 2023

An Act to repeal the Electric Power Sector Reform Act, No. 6, 2005 and enact the Electricity Act, 2023 to consolidate the laws relating to the Nigerian electricity supply industry, provide a comprehensive legal and institutional framework for the power sector in Nigeria in the areas of electricity generation, transmission, system operation, distribution, supply, trading, enforcement of consumer rights and obligations, provide for a holistic integrated resource plan and policy that recognizes all sources for the generation, transmission and distribution of electricity, including the integration of renewable energy to Nigeria’s energy mix and attract investments; and for related matters.

[COMMENCEMENT]                              [06TH DAY OF JUNE, 2023]

ENACTED by the National Assembly of the Federal Republic of Nigeria —                    

PART I — PRELIMINARY PROVISIONS

1.     Objectives of the Act

The primary objective of this Act is to provide a comprehensive legal and institutional framework to guide the operation of a privatized, contract and rule-based competitive electricity market in Nigeria and attract through transformative policy and regulatory measures, private sector investments in the entire power value chain of the Nigerian Electricity Supply Industry (in this Act referred to as “the NESI”), and specifically, the Act seeks to achieve the following objectives —

(a)    provide an ideal legal and institutional framework to leverage on the modest gains of the privatization phase of electric power sector in Nigeria to accelerate growth in power generation capacity and improve utilization of generated power through increased investments in new and efficient power generation technology and revamping existing power plants;

(b)    promote policy and regulatory measures to ensure the expansion of power transmission networks in Nigeria to address any imbalance in the existing transmission infrastructure;

(c)    stimulate policy and regulatory measures to generally scale up efficient power generation, transmission, and distribution capabilities of the power sector in Nigeria with a view to achieve a national electricity access targets and attaining the highest per capita power consumption in Africa within a reasonable time frame;

(d)    stipulate consequential, transitional and saving provisions regarding reforms made under the provisions of the Electric Power Sector Reform Act, No. 6, 2005 (in this Act referred to as “the Repealed Act”);

(e)    provide clear guide and legal basis for a phase-wide development of the Nigerian electricity supply industry since the conclusion of the privatization phase as implemented under the provisions of the Repealed Act;

(f)    promote the development of a competitive electricity market;

(g)    stimulate policy measures that will attract investments across the Nigerian electricity value chain to re-energize economic growth, drive job creation and improve the living conditions of Nigerians;

(h)    provide a clear legal and institutional framework for the formulation and adoption of a National Integrated Electricity Policy and Implementation Plan;

(i)     stimulate policies to address technology limitation and outdated infrastructure that are responsible for value chain losses in the NESI by attracting sustainable investments in new and efficient power generation technology and revamping existing power plants;

(j)    eliminate through policy and regulatory measures, barriers to investments in generation, transmission, distribution, and related sub-sectors in the electricity industry in Nigeria;

(k)    promote policies and regulatory measures to increase geographic coverage in power generation, transmission, distribution and supply of electricity in Nigeria;

(l)     provide a framework to stimulate the development and utilization of renewable energy sources and create an enabling environment to attract investment in renewable energy sources in order to increase the contribution of renewable energy to the energy mix;

(m)   provide a framework for improvement of access to electricity in rural, unserved, underserved, peri-urban and urban areas through the use of conventional sources and renewable energy off-grid and mini-grid solutions;

(n)    promote indigenous capacity in technology for renewable energy sources through a framework for local content in the Nigerian electricity supply industry;

(o)    promote public education on renewable energy production and consumption to increase the generation and consumption of electricity from renewable sources;

(p)    recognise third-party investments in NESI infrastructure by the private and public sectors;

(q)    provide a clear framework for cross-border electricity trade in the interest of national security and energy self-sufficiency;

(r)    promote frameworks for security of electricity infrastructure, prescribe effective punitive measures against electricity theft and other offences peculiar to the NESI; and

(s)    strengthen the relationship between federal electricity market and state electricity market.

2.     Application and scope of the Act

(1)    Subject to the provisions of section 4 and paragraphs 13, 14, and 15 of part II, of the Second Schedule to the Constitution, the provisions of this Act shall apply throughout the Federal Republic of Nigeria and with respect to all aspects and segments of the power sector value in Nigeria.

(2)    Nothing in this Act shall invalidate —

(a)    any law passed by the House of Assembly of a State with respect to all aspects of generation, transmission, system operation, distribution, supply and retail of electricity within that State;

(b)    any law passed by the House of Assembly of a State regarding the establishment, promotion and management of State electricity power stations;

(c)    any law passed by the House of Assembly of a State to sanction the establishment of a State electricity market, the establishment of a State electricity regulatory authority or any entity by whatever appellation with powers to regulate such markets;

(d)    any collaboration between States and Local Governments and the Federal Government for rural electrification, or between the States and Local Governments and distribution licenses to ensure electricity access to rural, unserved and underserved areas, promote investments in electricity or provision of electricity within States or Local Government Areas; or

(e)    any law passed by the House of Assembly of a State to sanction the establishment of a State electricity market and State Integrated Electricity Policy and Strategic Implementation Plan.

PART II — NATIONAL INTEGRATED ELECTRICITY POLICY AND STRATEGIC IMPLEMENTATION PLAN

3.     National Integrated Electricity Policy and Strategic Implementation Plan

(1)    The Federal Government through the Ministry for power shall, within one year from the commencement of this Act, initiate the process for the preparation and publication in the Federal Government Gazette, an Integrated National Electricity Policy and Strategic Implementation Plan in consultation with relevant government authorities and other stakeholders to guide the overall development of the electric power sector in Nigeria.

(2)    The National Electricity Policy and Strategic Implementation Plan adopted by the Federal Government under the provisions of subsection (1) shall encompass the following aspects relevant to the development of electric power sector in Nigeria —

(a)    development of electric power sector based on optimal utilization of resources such as coal, natural gas, nuclear substances and materials as well as renewable energy sources such as, solar, wind, hydro, hydrogen and other renewable sources of energy;

(b)    captive generation or stand-alone system for generation of electricity for rural areas and non-conventional energy system;

(c)    rural electrification and for bulk purchase of power and management of local distribution in rural areas;

(d)    public private partnerships for provision of access to electricity to all areas including villages, hamlets through rural electricity infrastructure and electrification of households;

(e)    power-source specific policies including waivers and subsidies that will stimulate development of renewable energy;

(f)     overall development of the electricity value chain in Nigeria with emphasis on alignment of expansion of generation, transmission, distribution and supply infrastructure to ensure reliability of supply and minimize losses; and

(g)    any other aspect of the power sector that the Federal Government may determine that it requires clear policy direction bearing in mind changes and new global developments in the sector.

(3)    The National Integrated Electricity Policy and Strategic Implementation Plan adopted under subsections (1) and (2), shall be approved by the Federal Executive Council.

4.     Periodic review of the National Integrated Electricity Policy

(1)    The National Integrated Electricity Policy and Strategic Implementation Plan approved by the Federal Executive Council ( in this Act referred to as “FEC”), under section 3 (3) of this Act, shall be reviewed or revised as required, but not later than every five years.

(2)    The National Integrated Electricity Policy and Strategic Implementation Plan or the revised version referred to under section 3 of this Act and subsection (1) respectively shall be initiated, formulated, deliberated upon, and adopted by the Ministry of Power in accordance with the provisions of this Act and same shall be approved by the FEC before the publication in the Federal Government Gazette for implementation.

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LAWS OF THE FEDERAL REPUBLIC OF NIGERIA

LAWS OF THE FEDERATION OF NIGERIA BY YEARS (MADE BETWEEN 1999-DATE)