By Godswill Odiong
President Bola Tinubu has signed the new Electricity Act into law, which replaces the 2005 Electricity and Power Sector Reform Act.

The Electricity Act was first passed in July 2022 in the administration of former President Muhammadu Buhari.

The new bill seeks to promote private sector investments in the Nigerian power sector and de-monopolise the nation’s electricity generation, transmission and distribution at the national level.

The Act empowers states, companies, and individuals to generate, transmit and distribute electricity.

Under the Act, electricity generating companies will be mandated to either generate power from renewable energy sources, purchase power generated from renewable energy or procure any instrument representing renewable energy generation.

Electricity generation licensees are obligated to meet renewable generation obligations as may be prescribed by NERC.

The Electricity Act also mandates the imposition of renewable purchase obligations on distribution or supply licensees.

The Act also states that anyone may construct, own or operate an undertaking for generating electricity not exceeding 1 megawatt (MW) in aggregate at a site or an undertaking for distribution of electricity with a capacity not exceeding 100 kilowatts (KW) in aggregate at a site, or such other capacity as NERC may determine from time to time, without a license.

Under the Act, lawmakers are granted the power to carry out oversight responsibilities and function over the NESI through its respective Committees on Power in the Senate and House of Representatives.