Electricity Regulation: States Unwilling To “Throw In The Towel” Despite Obvious Constraints
By Sunday Etuka
More than a year after Nigeria’s states began wresting electricity regulation away from the federal government, most are still struggling to make the power transferred to them work, yet none has shown any interest in handing it back.
As of NERC’s latest update in July/August 2026, 17 states have fully completed their transition to state electricity regulation, with Gombe becoming the most recent to do so in July.
A 17th, Akwa Ibom, has since received its transfer order, a milestone NERC Chairman, Musiliu Oseni confirmed at a Lagos seminar the same month.
The states that have taken over regulatory authority are Enugu, Ekiti, Ondo, Imo, Oyo, Edo, Kogi, Lagos, Ogun, Niger, Plateau, Abia, Anambra, Nasarawa, Bayelsa, Gombe and Akwa Ibom, with Enugu and Ekiti as the first movers, having begun the process back in October 2024.
The shift traces back to the Electricity Act 2023, which repealed the Electric Power Sector Reform Act of 2005 and took electricity off the exclusive legislative list, opening the door for states to generate, transmit, distribute and regulate power within their own borders for the first time.
Under the arrangement, NERC keeps oversight of interstate and international power markets, while qualifying states run their own intrastate systems, often through new subsidiary firms such as Enugu’s Mainpower Electricity Distribution Limited, licensed locally rather than by NERC.
A Forum of Nigerian Electricity Regulators was set up in March 2026 to help the federal commission and the expanding roster of state regulators work in sync.
POWER GAINED, CAPACITY LAGGING
Getting the authority has proven far simpler than using it. States are expected to pass their own electricity laws, build a functioning regulator, hire technical staff, draw up market rules, conduct sector audits, figure out subsidies and tariffs, and attract private investment, a list that has overwhelmed many state governments’ administrative and financial capacity.
Sources within NERC say some states approved months or years ago still lack fully operational regulatory commissions.
In Ogun State, which took over in December 2024, the commission says there is no functional regulatory structure in place and has flagged cases of electricity permits being issued by political appointees rather than a properly constituted regulator, including one involving a governor’s special assistant. Similar concerns have surfaced in Imo and Edo.
Power sector analyst Adetayo Adegbemle warned that permits issued outside the Electricity Act’s framework risk being struck down in court, threatening the wider decentralisation push.
The federal government itself has, at times, tried to slow things down. Former power minister Adebayo Adelabu paused further transfers, arguing the national market wasn’t mature enough to replicate across all 36 states at once, and pushed instead for a phased, pilot-based rollout that would let early problems be resolved before wider expansion.
Adelabu left the ministry in April 2026 to run for governor in Oyo State, but the process continued under NERC, with more states, Akwa Ibom included, receiving transfer orders since.
Frictions over authority persist even where regulatory structures exist on paper; a NERC directive in July 2026 requiring distribution companies to set aside revenue for network investment and debt repayment drew pushback from both the Discos and state regulators.
NO APPETITE FOR REVERSAL
Despite the gaps, state governments show no interest in ceding the powers back. Officials in transitioned states have generally admitted, in conversations with journalists, that the technical demands have been tougher than expected, but frame the difficulties as teething problems to work through rather than reasons to retreat.
Rivers, Delta and Osun have taken preliminary steps, such as passing their own electricity laws, positioning themselves to join the list even as states ahead of them continue wrestling with the powers they already hold.
NERC has set a February 17, 2027, deadline for all transfers currently in progress, Akwa Ibom’s included, to be completed.
EXPERTS WEIGH IN
Bode Fadipe, power sector analyst and CEO of Sage Consulting and Communications, argued that many states secured regulatory authority without the political commitment or expertise needed to use it well, and only began to drag their feet once the true scale of the responsibility became clear.
He pointed to the long gestation period of power sector investment and limited access to patient capital as major obstacles, noting that few states can realistically take on a power station or transmission facility, leaving most able to do little more than donate a handful of transformers.
Of the states already regulating their own markets, he said only Enugu shows meaningful effort, while Kogi is making some encouraging moves.
States yet to seek regulatory authority, he suggested, would be better off studying the process further before taking the leap.
He was also clear that NERC bears no blame for the lapses, since the law obliges the commission to hand over authority once a state meets the legal conditions, with no requirement that NERC first verify the state’s institutional readiness.
Chief Princewill Okorie, National President of the Association for Public Policy Analysis and the Electricity Consumers Protection Advocacy Centre, placed the responsibility for accountability squarely on citizens once a state law and regulator are in place.
He argued that distribution companies, operating in what he called a capitalist sector, have little incentive to change the status quo, and that citizens in many states remain largely passive while politicians, wary of upsetting Disco owners who help fund campaigns, avoid substantive commitments on power.
He cited Enugu State as a counterexample, where consumer advocacy led the state governor to set up a police investigative panel into the activities of EEDC and its subsidiary Transpower, following complaints from residents, a move that has since drawn in the regulator, the distribution company and consumers for scrutiny.
