HomeNewsPresident Tinubu Signs Electricity Act Amendment Bill into Law

President Tinubu Signs Electricity Act Amendment Bill into Law

Date:

President Bola Tinubu yesterday signed the Electricity Act (Amendment) Bill, 2024, into law.

The bill, which was passed by the House of Representatives on July 27, 2023, and the Senate on November 14, 2023, was sponsored by Hon. Babajimi Benson, who represents Ikorodu Federal Constituency of Lagos State.

The Electricity Act (Amendment) Bill, 2024 seeks to address the development and environmental concerns of host communities, and sets aside five percent of the actual annual operating expenditures of power generating companies (GENCOs) from the preceding year for the development of their respective host communities.

The Act further provides that the funds set aside for the development of host communities will be received, managed, and administered for infrastructure development in the host communities by a reputable Trustee/Manager to be jointly appointed by the respective GENCO and their host community.
The Act guarantees the de-centralisation and de-monopolisation of Nigeria’s electricity generation, transmission, and distribution at the National level and authorises states, companies, and individuals to generate, transmit and distribute electricity.
Under the Act, States are empowered to issue licences to private investors who in turn would be permitted to set-up and operate mini-grids and power plants within the State.

The licences obtainable include: electricity generation license (excluding captive generation); electricity transmission license; electricity distribution license; electricity supply license; electricity trading license; and system operation license. These licenses enable private entities to participate in different aspects of the electricity value chain, thereby promoting competition, and encouraging innovation to solve the growing energy needs of Nigeria.
Furthermore, the Act stipulates that without a license, a person may operate or construct an undertaking for the purpose of generating electricity not surpassing 1 megawatt (MW) in total at a site, or an undertaking for the distribution of electricity with a capacity not surpassing 100 Kilowatts (KW) in total at a site or such other capacity as the Commission may determine. In other words, it is possible for a person to construct, own, or operate an undertaking for the purpose of generating electricity or an undertaking for distributing electricity without obtaining a license, provided that such construction, ownership, or operation undertaking shall not exceed 1MW or distribution undertaking shall not exceed 100KW. However, the Act prohibits inter-state and transnational electricity distribution.

In a related development, Governor Seyi Makinde, yesterday, signed into law the Oyo State Electricity Regulatory Commission Bill 2024.
The governor, who performed the signing ceremony at the Conference Room of the Governor’s Office, Secretariat, Agodi, Ibadan, said the signing was to give the state opportunity to develop its own roadmap to sustainable electricity.

The governor stated that with the decentralisation of electricity generation, transmission and distribution, it had become obvious that Nigerians can access dividends of democracy if federalism is practised as it should be and more powers are devolved to the states.
He said, “As promised earlier in the week, we are signing the Oyo State Electricity Regulatory Commission Bill 2024 into law today. This law will enable Oyo State generate, transmit and distribute electricity within the State.

“Amendments of the constitution like these is what we mean when we advocate for fiscal federalism. In years to come as we work towards energy sufficiency, our people can hold State Governments accountable on the issue of electricity supply.”
While presenting the Bill earlier, Deputy Speaker, Oyo State House of Assembly, Hon. Mohammed Fadeyi, said this is the first time that the state would come up with an independent electricity project.

Present at the signing of the Bill were the Deputy Governor, Barr. Bayo Lawal; Secretary to the State Government; Prof. Olanike Adeyemo; Chief of Staff to the Governor, Hon. Segun Ogunwuyi and the Head of Service, Mrs Olubunmi Oni (mni).
From the House of Assembly, the Deputy Speaker, Hon. Fadeyi; Chairman, House Committee on Energy, Hon. Deji Oparinde and a member of the committee, Hon. Gabriel Babajide, were in attendance.

Also in attendance were the Commissioner for Justice and Attorney-General, Mr Biodun Aikomo; Commissioner for Energy, Mr Temilolu Ashamu; Chairman and co-chairman of the Oyo State Elders’ Council, Dr Saka Balogun and Elder Wole Oyelese, respectively.

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