The Electricity Act 2023 was designed to transfer significant regulatory powers from the federal level to states, yet implementation across many regions remains slow and uneven.
The law ended the long-standing central control of electricity management, allowing subnational governments to oversee generation, transmission, and distribution within their territories.
Despite this shift, several states have yet to take concrete steps to establish frameworks that would enable them to exercise these new powers effectively.
POWER SUPPLY REALITIES
Nigeria continues to generate between 4,000 and 5,000 megawatts for a population exceeding 230 million, far below the estimated national demand of about 40,000 megawatts.
This gap has remained largely unchanged over the years, reflecting persistent structural challenges in the sector.
As a result, many businesses and households rely heavily on alternative power sources, particularly private generators.
Industry data indicates that more than 70 per cent of firms generate their own electricity, creating what analysts describe as an informal or parallel energy system.
Large industrial groups have invested heavily in self-generation, while smaller businesses face rising costs due to fuel dependence and unstable supply.
ECONOMIC IMPACT
The manufacturers association of nigeria has consistently raised concerns over the financial burden of energy on industrial operations.
According to the association, energy expenses account for over 40 per cent of production costs for many manufacturers.
This situation has affected competitiveness, reduced profit margins, and in some cases contributed to factory closures.
Small and medium enterprises also report similar challenges, citing erratic power supply and high fuel costs as key constraints to growth.
ELECTRICITY ACT EXPECTATIONS
The electricity act was introduced to encourage competition, improve service delivery, and attract investment into the sector.
By decentralising authority, the law allows states to develop tailored energy policies that reflect local conditions and needs.
However, only a limited number of states have begun implementing the provisions, while others remain at various stages of consideration.
States including Adamawa, Akwa Ibom, Bauchi, Benue, Borno, Cross River, Delta, Ebonyi, Gombe, Jigawa, Kaduna, Kano, Katsina, Kebbi, Kwara, Osun, Rivers, Sokoto, Taraba, Yobe, and Zamfara are yet to fully operationalise the law.
MODEL PROJECTS AND LESSONS
The geometric power project in Aba has been cited as an example of how integrated generation and distribution systems can improve electricity supply.
The project, supported by the african export-import bank, combines power generation with distribution within a defined industrial cluster.
Reports indicate that it supplies relatively stable electricity to thousands of users and supports economic activity within the area.
Analysts note that such models demonstrate the potential benefits of decentralised electricity systems when properly implemented.
TARIFF AND REGULATION
Recent developments in Enugu state have also highlighted the role of local regulation in tariff setting and service delivery.
The enugu state electricity regulatory commission introduced a pricing structure aimed at balancing affordability with cost recovery.
The adjustment reduced tariffs for certain categories of consumers while maintaining service standards.
Observers say such approaches may help address concerns about pricing transparency and service quality.
INFRASTRUCTURE CHALLENGES
Gas supply remains a major factor affecting electricity generation in Nigeria, as many power plants depend on thermal energy sources.
Inconsistent gas delivery, pipeline limitations, and commercial constraints continue to affect output levels.
Even projects designed to operate at higher capacity have reported reduced performance due to inadequate gas supply.
This has raised broader concerns about infrastructure development and the need for coordinated investment across the energy value chain.
ALTERNATIVE ENERGY OPTIONS
Experts suggest that states may need to diversify energy sources to complement existing thermal generation.
Renewable options such as solar, wind, and small hydro projects are increasingly being considered for off-grid and rural electrification.
Mini-grid systems and standalone solutions are also viewed as practical alternatives for communities not connected to the national grid.
Such approaches could reduce reliance on centralised systems and improve access to electricity in underserved areas.
IMPLEMENTATION DELAYS
The slow pace of adoption by many states has raised questions about administrative readiness and policy priorities.
Some analysts attribute the delay to regulatory complexities, funding concerns, and the need for technical capacity at the state level.
Others point to competing development priorities and institutional adjustments required to implement the law effectively.
OUTLOOK
The electricity act provides a framework for restructuring the sector, but its success depends largely on timely and coordinated implementation.
States that move to establish regulatory bodies and attract investment may begin to see improvements in supply and service delivery.
Conversely, continued delays could prolong existing challenges and limit the impact of the reforms.
As the transition continues, stakeholders across government and industry are expected to monitor progress and address gaps in execution.
