Electricity Act Will Create Tariff Inequality—Expert
The Convener of PowerUp Nigeria, an electricity consumer advocacy group, Mr Adetayo Adegbemle, has warned that the Electricity Act 2023 will cause tariff disparities across state lines and threaten consumer equity and the integrity of Nigeria’s power market.
THE WHISTLER recalls the Electricity Act (EA) 2023, which repealed the Electric Power Sector Reform Act (EPSRA) of 2005, was signed into law in June 2023 by President Bola Tinubu.
The Act devolves power sector responsibilities previously concentrated at the federal level. It empowers subnational governments to legislate, generate, transmit, and distribute electricity, particularly to areas not served by the national grid.
However, Adegbemle, in a statement he sent to THE WHISTLER on Tuesday, said the act could cause more harm than good if not matched with institutional reforms and a national coordination framework.
He said, “The Electricity Act risks creating tariff inequality across state lines, with each state now empowered to independently set electricity tariffs, we could see neighbouring communities facing drastically different electricity costs.
“One border town could pay up to 60% more than another simply because of state-level pricing structures.”
Adegbemle noted that many states currently lack the financial, technical, and regulatory capacity to operate electricity markets effectively.
He said that despite the devolution of power from the Nigerian Electricity Regulatory Commission (NERC), only a few states have initiated serious regulatory planning or published credible tariff methodologies.
“Several states have yet to draft rules for metering, energy theft reduction, or cost-reflective pricing. This gap opens the door to fragmented markets, where industrial users may migrate to low-tariff states, leaving poorer households to bear the burden of higher charges elsewhere,” Adegbemle said.
He argued that the absence of enforceable national standards, cross-border coordination rules, and a harmonised subsidy framework undermines the spirit of decentralisation envisioned in the Act.
“There are no clear national guardrails, no standard subsidy policy, no mechanism to ensure low-income customers get minimum access, even though the Act calls for interstate coordination under Section 34,” Adegbemle added.
To address the risks, he proposed a multi-pronged transition plan to include the development of a national regulatory template with minimum standards for State Electricity Regulatory Commissions (SERCs) and the adoption of regional regulators or state consortia to maintain economies of scale, among others.
Adegbemle also advised against rushing legislative amendments until all states have functional electricity laws developed through deep stakeholder consultations.
“Real empowerment requires not just devolved authority but shared standards and enforcement capacity. Without that, the Electricity Act may deepen the very chaos it aims to resolve,” Adegbemle warned.
He, however, called for stronger leadership from the Federal Ministry of Power to steer a coherent transition that balances state autonomy with national coherence.
Electricity Act Will Create Tariff Inequality—Expert is first published on The Whistler Newspaper
