Nigerian Government Caps Electricity Sales to Neighboring Countries at 6%



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The Nigerian government has enacted a directive imposing a 6% limit on electricity sales to neighboring countries, including Niger Republic, Benin Republic, and Togo.

The order, issued by the Nigerian Electricity Regulatory Commission (NERC) to the System Operator (SO) within the Transmission Company of Nigeria (TCN), was signed by the commission’s Chairman, Sanusi Garba, and Vice Chairman, Musiliu Oseni. Dated April 29, 2024, the directive came into effect on May 1, 2024.

According to the NERC, the order, valid for an initial six-month period, is in line with Section 116 of the Electricity Act 2023. It aims to enhance electricity supply and financial sustainability within the Nigerian Electricity Supply Industry (NESI) by gradually transitioning to cost-reflective tariffs.

Under the directive, the SO is mandated to develop a pro-rata load-shedding scheme within seven days to ensure equitable load allocation to all stakeholders, including off-takers, Distribution Companies (DisCos), international customers, and eligible customers. Additionally, hourly readings of off-take by market participants must be logged and published, with enforcement of sanctions for any violations.

Furthermore, the maximum load allocation to international off-takers is capped at 6% of total available grid generation. Generating plants are limited to nominating up to 10% of their available generation capacity to international off-takers, with exceptions subject to commission approval.

The order also prohibits the recognition of any capacity addition in bilateral transactions between generators and off-takers without explicit commission approval. It mandates the installation of integrated IoT meters at all off-take and delivery points within three months to provide real-time visibility of electricity transactions.

Additionally, the SO and Market Operator are required to submit schedules and copies of all bilateral contracts administered through the grid, seeking commission approval for any new transactions.

By instituting these measures, the Nigerian government aims to ensure transparency, fairness, and sustainability in electricity transactions while minimizing disruptions to domestic supply obligations. The directive underscores the government’s commitment to fostering a robust and accountable energy sector that serves the interests of all stakeholders.

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Gbenga Samson
Gbenga Samson
Samson Gbenga Salau [Editorial Board Adviser] Gbenga Samuel Salau is a professional journalist with over 17 years experience in journalism, he is a graduate of Communication and Language Arts, University of Ibadan. On completion of his youth service, he joined The Guardian as a freelance journalist and was later absorbed as a staff. While in the University, he was a campus journalist reporting for the Independence Hall and Faculty of Arts Press Clubs. As a campus journalist, he won the following awards; Independence Hall Press Best News writer; University of Ibadan Union of Campus Journalists’ Best News Reporter/Writer; First Runner-up, Reuben Abati Award for Investigative Journalism; Association of Faculty of Arts Students’ Press Best Reporter; University of Ibadan Union of Campus Journalists’ Best Political Writer; Winner, Reuben Abati Award for Investigative Journalism, and University of Ibadan Union of Campus Journalists’ Best Interviewer. He served the Association of Communication and Language Arts Students, as the Public Relation Officer, the same year he was appointed the News Editor of the Association of Faculty of Arts Students Press. The following session, he was made the General Editor, and a member of the 13-man University of Ibadan Students’ Union Transition Committee. As a reporter in The Guardian, in 2014, he won the Promasidor Quill Award Best Report on Nutrition and DAME Business Reporting category. In the 2015 edition of the Promasidor Quill Award, he won the best Report on Nutrition and Brand Advocate Categories, while in 2016, he won the NMMA Print Journalist of the Year, first runner-up Golden Pen Reporter of the Year and SERAs CSR Awards. Gbenga Salau loves traveling, reading, and listening to songs with good lyrics no matter the genre.

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