Federal Government Transfers Lagos Electricity Market Oversight To LASERC

The Federal Government, through the Nigerian Electricity Regulatory Commission (NERC), has announced the transfer of regulatory oversight of Lagos State’s electricity market to the newly established Lagos State Electricity Regulatory Commission (LASERC). This decision, disclosed via NERC’s statement on X (formerly Twitter) on Thursday, aligns with the amended Nigerian Constitution and the Electricity Act (EA) 2023.

Decentralizing Nigeria’s Electricity Sector

The Electricity Act 2023 grants states the authority to regulate their intrastate electricity markets, provided they meet specific requirements and notify NERC. Following this legal framework, Lagos State fulfilled the stipulated conditions and requested NERC to cede regulatory control to LASERC.

NERC will, however, retain its role as the central regulator for inter-state and international electricity operations, including generation, transmission, supply, trading, and system management.

Key Steps for the Transition

The transfer process outlined by NERC mandates specific actions by electricity distribution companies operating in Lagos State:

1.Eko Electricity Distribution Plc (EKEDP):

•Incorporate a subsidiary, EKEDP SubCo, to manage intrastate electricity supply and distribution.

•Complete incorporation by February 3, 2025, and obtain a license from LASERC for operations.

2.Ikeja Electric Plc (IE):

•Incorporate a subsidiary, IE SubCo, for similar intrastate responsibilities.

•Complete incorporation by February 3, 2025, and secure a license from LASERC.

All transitions must be finalized by June 4, 2025.

Legislative Backing

This development comes two weeks after Governor Babajide Sanwo-Olu signed the Lagos State Electricity Bill 2024 into law, paving the way for localized regulation of electricity operations within the state.

Statement from NERC

The statement read:

“In compliance with the amended Constitution of the Federal Republic of Nigeria and the Electricity Act 2023, NERC has issued an order to transfer regulatory oversight of the electricity market in Lagos State to LASERC. The transfer reflects the increasing decentralization of regulatory power, enabling states to manage their local energy markets effectively.”

Implications for Lagos State

The establishment of LASERC and the transfer of oversight responsibilities underscore Lagos State’s push for autonomy in managing its electricity sector. This shift is expected to enhance efficiency, improve electricity access, and drive localized solutions to energy challenges in Nigeria’s commercial hub.

The collaboration between NERC and LASERC sets a precedent for other states seeking to regulate their electricity markets under the provisions of the EA 2023.