Nigeria Expands Independent Power Distribution Landscape: 10 Out of 17 New Operators Already In Action

The Nigerian government is making significant strides in diversifying its power distribution landscape, according to the recently released 2022 Market Competition Report by the Nigeria Electricity Regulatory Commission (NERC).

The report sheds light on the country’s power distribution sector, which plays a pivotal role in Nigeria’s electricity industry, comprising generation, transmission, and distribution.

Back in November 2013, Nigeria underwent a pivotal transformation when the power sector was unbundled into these three segments. Eleven successor distribution companies emerged from this process and were subsequently privatized. Despite some consumer complaints, these companies have been diligently serving the nation ever since.

However, the latest report indicates that Nigeria’s power distribution market is evolving further. The NERC report reveals that all 11 successor distribution companies have been successfully privatized, marking a transition of ownership and management into private hands. Moreover, an additional private distribution company has secured a license to operate within a designated franchised area.

One significant development highlighted in the report is the licensing of 17 Independent Electricity Distribution Networks operators, with 10 of them already up and running as of December 2022. This expansion aims to enhance competition and improve the overall efficiency and effectiveness of the power distribution network in Nigeria.

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The annual Market Competition Report, as mandated by the Electric Power Sector Reform Act 2004, provides valuable insights into the Nigerian Electricity Supply Industry’s potential for competition. It evaluates the current level of competition in the industry and offers recommendations for transitioning to a more competitive market, aligning with Section 26 of the Electric Power Sector Reform Act.

The report is intended for a diverse audience, including government officials, private sector stakeholders, energy experts, financial analysts, market observers, potential investors, and the general public.