Introduction

Nigeria’s evolving electricity landscape, particularly after the enactment of the Electricity Act 2023, has shifted from a predominantly centralized federal framework to a multi-level governance model. This transformation empowers states to establish their own electricity markets while maintaining alignment with national policies. Ensuring regulatory coherence in this new dispensation requires robust coordination, transparent data sharing, and innovative platforms that guide policy harmonization. This article explores how data-driven approaches—through initiatives like the Rural Electrification Agency's (REA) programs, digital monitoring tools, and regulatory scorecards—are shaping Nigeria’s decentralized electricity governance structure.

Understanding the Policy Shift

The Electricity Act 2023 repealed the Electric Power Sector Reform Act of 2005 and entrenched state participation in electricity governance. States are now authorized to license and regulate electricity generation, transmission, and distribution within their jurisdictions. While this creates an opportunity for tailored energy solutions, it also introduces the risk of regulatory fragmentation and inconsistent standards. As such, federal agencies like the Nigerian Electricity Regulatory Commission (NERC) and REA play a key role in ensuring coherence through standards, guidelines, and technical support.

Digital Platforms and Monitoring Tools

A key enabler of alignment is the development and adoption of structured, data-driven frameworks that allow for comparative assessment and progress tracking. While platforms like the State Alignment System (SAS) and the Nigeria Energy Database (NED) have been conceptualized or mentioned in policy discourse, there is limited public evidence confirming their full deployment or operational status.

Nevertheless, such platforms, if developed and maintained, could provide real-time visibility into state-level reforms by tracking indicators such as:

• • Enactment and operationalization of state electricity laws
• • Establishment of state-level electricity regulatory agencies
• • Partnerships with DISCOs and private developers
• • Availability and quality of geospatial data for energy planning

These kinds of tools would significantly enhance transparency and support evidence-based decision-making across multiple tiers of government. Their absence underscores the urgent need for coordinated digital infrastructure to support Nigeria’s decentralized electricity governance.

Human Capital and Operational Gaps

Despite regulatory progress, Nigeria faces critical challenges in workforce capacity and operational efficiency. According to the Federal Government, the country lacks half of the skilled workforce required to effectively operate and expand the power sector (The Electricity Hub, 2025). This skills deficit threatens to undermine efforts at both federal and state levels to implement electricity reform policies.

Broader Policy Integration Beyond DARES

While the Distributed Access through Renewable Energy Scale-up (DARES) programme illustrates harmonized implementation, it is only one part of Nigeria’s energy transition. Programs like the Nigeria Electrification Project (NEP), initiatives by Kaduna Electric to establish 100 MW solar parks, and Wärtsilä’s recently awarded 30 MW project in Nigeria all demonstrate increasing collaboration between states, DISCOs, and international developers. These projects operate within frameworks defined by national standards but adapted by states based on local context.

Fiscal Challenges and Accountability Pressures

Regulatory harmonization efforts must also contend with financial realities. The NDPHC recently raised concerns over a N600 billion electricity debt, while civil groups are increasingly calling for the revocation of licenses from underperforming DISCOs. Such pressures highlight the need for transparent performance benchmarks and the alignment of investment incentives with service delivery expectations.

Climate and Sustainability Considerations

Regulatory harmonization efforts must also contend with financial realities. The NDPHC recently raised concerns over a N600 billion electricity debt, while civil groups are increasingly calling for the revocation of licenses from underperforming DISCOs. Such pressures highlight the need for transparent performance benchmarks and the alignment of investment incentives with service delivery expectations.

Stakeholder Engagement and Intergovernmental Dialogue

Collaborative mechanisms such as the National Council on Power (NACOP), state-led workshops, and joint REA-DISCO-community town halls provide a forum for aligning strategies. These engagements help to clarify the interface between state electricity bureaus and national regulators, fostering mutual accountability. Stakeholders include not only policymakers but also traditional rulers, CSOs, and private sector actors whose insights contribute to local adaptation of national frameworks.

Case Examples: State-Level Regulatory Innovation

States like Lagos, Jigawa, and Ekiti have demonstrated how proactive legislative reforms and digital reporting can foster alignment. Jigawa, for instance, established a Renewable Energy and Climate Change Department and signed collaboration agreements with REA, reflecting strong alignment on institutional objectives. Lagos, on the other hand, developed its own smart metering initiative and passed a comprehensive electricity law—demonstrating sub-national leadership in electricity governance.

The Role of NERC Regulations and Guidelines

Key instruments aiding harmonization include:

• • The Mini-Grid Regulation 2016, which outlines standards for interconnected and isolated systems
• • The Regulations on Investments in Electricity Networks 2015, encouraging transparency and project viability
• • The Distribution Franchising Guidelines 2020, enabling DISCO partnerships while ensuring NERC oversight
• • The Eligible Customer Regulation 2017, which facilitates bulk procurement within a regulated framework

Together, these instruments form a scaffold for uniform practices even as states tailor implementation to their unique contexts.

Conclusion

Nigeria’s decentralized electricity market is gaining traction, but its success hinges on well-orchestrated regulatory alignment between federal and state actors. Data-driven platforms, inclusive stakeholder engagement, coherent regulatory frameworks, and consideration of climate and economic sustainability are proving essential in managing this complexity. Programs like DARES contribute meaningfully, but the broader ecosystem—comprising NEP, state-led reforms, national regulatory instruments, and multi-sectoral dialogue—is what truly underpins harmonization. As more states embrace their electricity mandates, sustained intergovernmental collaboration and investment in human capital will be vital to achieving an inclusive, efficient, and sustainable national electricity market.

References

1. 1. Electricity Act, 2023
2. 2. Nigeria Energy Database (energydata.org.ng)
3. 3. REA: DARES State Alignment System (SAS) Walkthrough Document, 2024
4. 4. NERC Guidelines on Distribution Franchising, 2020
5. 5. NERC Mini-Grid Regulation, 2016
6. 6. REA: NEP & REF Program Guidelines
7. 7. NERC Regulation for IEDN, 2012
8. 8. NERC Regulation for Investment in Electricity Networks, 2015
9. 9. NERC Eligible Customer Regulation, 2017
10. 10. Overview of NERC Consultation Paper on Franchising, 2019
11. 11. “Nigeria Lacks Half the Skilled Workforce Needed for Power Sector — FG,” The Electricity Hub, 2025
12. 12. “Nigeria Reaffirms Commitment to July Climate Change Summit,” EnviroNews, 2025
13. 13. “Wärtsilä Chosen for 30 MW Power Plant Project,” PowerOnline, 2025
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19. 19. “Lagos Sets Pace in Power Reform,” BusinessDay, 2025