In a significant move that could reshape the electricity landscape in Lagos, the state has officially taken over the regulatory control of its electricity market from the Nigerian Electricity Regulatory Commission (NERC). This historic development marks a crucial shift in the governance of the state’s power sector and is set to bring about major changes in electricity supply and distribution within Lagos.
The transfer of regulatory powers was formalized during a key event held at NERC’s headquarters in Abuja. The occasion was attended by key figures in the energy sector, including Biodun Ogunleye, the Commissioner for Energy and Mineral Resources of Lagos State. His presence underscored the importance of this transition, which aligns with recent updates to both the Electricity Act of 2023 and the amended Constitution of the Federal Republic of Nigeria. These changes have given individual states the authority to regulate electricity within their borders, opening the door for Lagos to exercise greater control over its energy sector.
A Landmark Decision
The decision to give Lagos regulatory control over its electricity market is seen as a monumental step in Nigeria’s ongoing efforts to decentralize power sector governance. Lagos is now one of the first states in Nigeria to gain full control of its electricity market, positioning it as a model for other states. This move is expected to improve the way electricity is managed, distributed, and consumed in Lagos, which is the country’s commercial hub and one of the most populous cities in Africa.
Under the new arrangement, two of Lagos’s main electricity distribution companies—Eko Electricity Distribution Plc (EKEDP) and Ikeja Electric Plc (IE)—are now required to set up new subsidiaries to handle their operations specifically within Lagos State. These subsidiaries, named EKEDP SubCo and IE SubCo, must be incorporated within 60 days from December 5, 2024, and will operate under the regulatory oversight of the newly established Lagos State Electricity Regulatory Commission (LASERC).
This transition process will be completed by June 4, 2025, by which time the new subsidiaries should be fully operational, managing electricity supply and distribution throughout Lagos. This shift in regulatory control is expected to lead to more localised decision-making and a focus on the unique challenges and opportunities within the state.
The establishment of LASERC, which will take on the responsibility of overseeing electricity operations in Lagos, is an important part of this change. LASERC is tasked with ensuring that the electricity distribution companies comply with state policies and regulations, which are expected to be tailored to meet the specific needs of Lagosians. The move also aims to improve the overall quality of electricity services in Lagos, which has long struggled with issues such as power outages, poor service delivery, and a lack of sufficient infrastructure.
Lagos’s government has expressed its commitment to enhancing the electricity sector and providing a more reliable power supply to its residents. With the new regulatory powers, LASERC will have the authority to implement policies and initiatives designed to improve service delivery, increase efficiency, and attract private sector investments in the energy sector.
During his speech at the event, Commissioner Ogunleye praised the Nigerian Electricity Regulatory Commission (NERC) for its role in enabling the successful transfer of powers to Lagos. He acknowledged NERC’s leadership and vision in paving the way for this historic transition, which he believes will allow Lagos to better cater to the energy needs of its citizens. Ogunleye also highlighted that the move would bring new opportunities for growth, especially in terms of economic development and technological innovation within the electricity sector.
“We are ready to take on the responsibility of regulating our electricity market,” Ogunleye said. “This is a major step forward in our efforts to improve the quality of service for Lagosians. With this new power, we can focus on the unique needs of Lagos and implement policies that will better serve our growing population.”
The move is expected to have far-reaching impacts on the residents of Lagos. For years, residents have complained of poor electricity service, with frequent power outages and erratic supply. With LASERC now in charge, the hope is that the state government will be able to improve these services by addressing the specific challenges faced by the state. The aim is to ensure more reliable and consistent electricity distribution, which is crucial for both residential and commercial activities in Lagos.
Lagos is known for its large population and booming economy, and the demand for electricity continues to grow. As Nigeria’s economic center, Lagos’s infrastructure must meet the needs of a rapidly developing city. By taking control of the electricity sector, the state can implement policies that promote sustainable energy solutions, encourage investment in the energy sector, and help to meet the growing demand for power.
