A fresh dispute has erupted over the future of Nigeria’s electricity sector, with state electricity regulators accusing the National Assembly of attempting to take back powers already granted to states under the Constitution and the Electricity Act 2023.
The disagreement centres on the proposed Electricity Act (Amendment) Bill 2026 currently before the National Assembly. While lawmakers say the amendment is aimed at improving the electricity market, state regulators argue that some of its provisions could reverse one of the biggest reforms ever introduced in Nigeria’s power sector.
In a strongly worded memorandum submitted to the Senate Committee on Power on Tuesday, electricity regulatory commissions and bureaus from 16 states warned that the proposed amendments could weaken the decentralisation of the electricity industry and restore broad control to the Federal Government.
The memorandum was contained in a letter dated May 26, 2026, addressed to the Chairman of the Senate Committee on Power.
It was signed on behalf of state electricity regulatory agencies in Abia, Anambra, Bayelsa, Edo, Ekiti, Enugu, Gombe, Imo, Kogi, Lagos, Nasarawa, Niger, Ogun, Ondo, Oyo and Plateau states.
The regulators said they had relied on the Electricity Act 2023 to establish sub-national electricity markets and attract investors into their various states. According to them, changing the rules at this stage could undermine confidence and disrupt ongoing investments.
“We represent State Regulatory Commissions and Bureaus that have taken advantage of the Electricity Act 2023 to commence the development of our sub-national electricity markets and sectors,” the memorandum stated.
The regulators explained that they had earlier met with members of the Senate Committee on Power to discuss their concerns. Following the meeting, they were asked to consolidate their objections into a single document for consideration by lawmakers, the Nigerian Electricity Regulatory Commission (NERC) and other stakeholders.
According to the memorandum, the states identified 17 contentious provisions in the amendment bill which they believe could undermine powers already granted to them by the Constitution.
Among the major areas of disagreement are provisions relating to the powers of State Houses of Assembly to legislate on electricity matters, the supremacy of state electricity laws within state markets and attempts to retain federal control over activities linked to the national grid.
The regulators also faulted proposed restrictions on states participating in the wholesale electricity market, provisions concerning the Nigerian Wholesale Electricity Market and clauses affecting state authority over independent transmission and distribution systems.
Other concerns relate to the proposed administration of the Power Consumers Assistance Fund, the expansion of the powers of the Nigerian Electricity Management Services Agency, the structure of the Forum of Electricity Regulators and NERC’s proposed final authority in resolving disputes involving state regulators.
The states also objected to proposals classifying electricity generation, transmission, distribution and supply as essential services covering both federal and state electricity markets.
According to them, such provisions could indirectly expand NERC’s influence into areas that are already under state control.
At the heart of the dispute is the interpretation of constitutional amendments that allowed states to regulate electricity activities within their territories.
The regulators argued that the proposed amendment wrongly assumes that State Houses of Assembly derive their powers from the National Assembly.
They described this interpretation as a misunderstanding of Nigeria’s constitutional arrangement.
“Section 2 of the Bill aims to amend Section 2 of the Principal Act. By that section, the National Assembly reserves to itself the power to delegate legislative powers to States’ Houses of Assembly,” the memorandum stated.
The regulators argued that only the Constitution can define and allocate legislative powers between the Federal Government and the states.
According to them, the National Assembly cannot grant or withdraw such powers through ordinary legislation.
They warned that allowing such provisions to stand could weaken the principle of federalism, which guarantees a balance between national authority and state autonomy.
“The constitutional division of powers is fundamental to federalism,” the memorandum stated.
“There is no legal framework for the National Assembly to empower state governments to make law through ordinary legislation.”
The state agencies further argued that the proposed amendments could discourage investors who had committed resources based on the provisions of the Electricity Act 2023.
According to them, many states have already developed electricity policies, passed laws and begun discussions with investors to improve electricity supply.
Changing the framework midway, they said, could create uncertainty and slow down progress.
“A review of the Bill suggests that the general intention is to reverse the devolution of legislative, governance and regulatory powers over electricity matters that occur solely within the respective states,” the regulators stated.
They added that Nigeria had operated a largely centralised electricity system for about two decades without significant improvements in power supply or electricity consumption.
For years, Nigeria’s power sector has struggled with inadequate generation, poor transmission infrastructure and weak distribution networks.
Despite several reforms and the privatisation of electricity distribution companies in 2013, millions of Nigerians still experience regular blackouts and rely heavily on generators for electricity.
The Electricity Act 2023 was introduced as a major reform following the Fifth Alteration to the 1999 Constitution, which removed electricity from the Exclusive Legislative List and empowered states to generate, transmit and distribute electricity within their boundaries.
The objective was to encourage innovation, attract investment and allow states to address their unique electricity needs.
Since then, several states, including Lagos, Edo, Enugu, Ekiti and Ondo, have enacted electricity laws and established regulatory agencies to oversee emerging electricity markets.
Some states have also begun developing mini-grid projects and exploring partnerships with private investors to improve supply.
The regulators insisted that proper coordination between NERC and state agencies, rather than federal dominance, was the best path forward.
“What is required to attain the full benefits of decentralisation is proper coordination on transmission matters between NERC and state regulators, and not top-down federal legislation,” they said.
They also rejected proposals allowing NERC to exercise final administrative authority over disputes involving state regulators.
According to them, NERC and state regulatory commissions operate within separate constitutional spheres and should relate as partners rather than in a superior-subordinate arrangement.
The state agencies suggested that cooperation among regulators should be achieved through memoranda of understanding and voluntary agreements instead of mandatory federal directives.
As deliberations continue on the proposed Electricity Act (Amendment) Bill 2026, the outcome could shape the future of Nigeria’s electricity reforms.
The decision taken by lawmakers will determine whether the country deepens the decentralisation introduced by the Electricity Act 2023 or returns to a more centralised system of electricity regulation.
For millions of Nigerians who continue to battle unreliable power supply, stakeholders say the ultimate goal should be a system that delivers stable, affordable and accessible electricity, regardless of which level of government takes the lead.