What is it?
Regional electricity markets promote inter-state electricity trade, encouraging power security and economic growth.
Why are we talking about it?
The government recently passed the Electricity Act of 2023. This allows states to develop their own electricity markets.
Why is it important?
A regional power market will allow Nigerian states to buy and sell electricity. If they produce more power than they can use, they can sell it to other states.
How will it be managed?
Any agreements between states about buying and selling electricity will be subject to national regulations and overseen by the National Electricity Regulatory Commission.
6 things that are needed for success
- identify responsibilities and powers between the regulator and state government
- enable financially healthy companies
- seek clarity about state governments’ power to incentivize
- ensure accurate development planning
- determine benefits & responsibilities of collaborating states
- understand possible risks of dual licensing
