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In a groundbreaking move, the 36 state governors in Nigeria have united to tackle the nation’s chronic power shortages by challenging the existing monopoly of Distribution Companies (DisCos). This development follows the enactment of key legislative reforms aimed at decentralizing power distribution across the country.
The push for these reforms gained momentum after President Muhammadu Buhari signed the constitutional amendment in March 2023, allowing states to independently generate, transmit, and distribute electricity. Recently, President Bola Tinubu reinforced this shift by signing the Electricity Act of 2023, further encouraging the breakdown of existing monopolies in electricity generation, transmission, and distribution.
This legislative overhaul empowers states, companies, and individuals to engage more actively in the electricity sector. Asishana Okauru, the Director General of the Nigeria Governors’ Forum (NGF), described the new Electricity Act as a “game-changer,” allowing states to set up their own distribution frameworks and address inefficiencies in the power supply. “The new Electricity Act is a significant step towards realistic restructuring, and we are excited to see the positive impact it will have on the power sector,” Okauru said.
To address the challenges, the NGF has taken a proactive role by establishing a dedicated power desk within its Secretariat. The forum has engaged consultants and set up a Forum of Commissioners of Power across the states to tailor local solutions to local energy needs. This includes restructuring Discos, as confirmed by Adebayo Adelabu, the Minister of Power, who revealed ongoing efforts to reorganize the distribution companies along state lines for enhanced efficiency. “The current structure, where a single Disco might cover multiple states, is impractical and detrimental to efficiency. By aligning Discos with state boundaries, we can enhance accountability and performance,” explained Adelabu during a recent oversight visit by the Senate Committee on Power.
Labor unions, represented by the Nigerian Labour Congress (NLC) and Trade Union Congress (TUC), have also welcomed these developments, particularly emphasizing the need for equitable metering to eliminate the controversial practice of estimated billing. “We are pleased to see the progress being made in the power sector, and we urge the government to ensure that the reforms are implemented in a way that benefits all Nigerians,” said Ayuba Wabba, the NLC President.
Despite these promising steps, the actual implementation remains a significant challenge. The federal government has begun the process by ordering the restructuring of Discos that are currently underperforming or managed by financial institutions due to debt. This restructuring includes transitioning management to state control where possible. Additionally, the government has announced plans to invest in grid expansion and modernization, as well as promote renewable energy sources to increase power generation capacity.
The governors’ united stance and the legislative reforms aim to decentralize power distribution, increase efficiency, and address the nation’s chronic power shortages. This move has the potential to bring significant improvements to Nigeria’s electricity sector, benefiting citizens and businesses alike. With the support of labor unions and the federal government, the country is poised to make significant strides in addressing its power challenges and achieving a more stable and efficient electricity supply.