Electricity Act 2023 — Key Provisions, Effects, Full Background

01 Background

The Electricity Act 2023 is the most consequential reform of the Nigerian power sector since unbundling in 2005. It repeals the Electric Power Sector Reform Act 2005 and devolves regulatory authority to state governments. States can now legislate, generate, transmit and distribute electricity within their borders. The Act also explicitly permits embedded generation, captive power above 1MW without licence, and simplifies mini-grid licensing for off-grid solar.

02 Key provisions · 8

§ 01

States can establish their own State Electricity Regulatory Commissions (SERCs)

§ 02

Embedded generation (decentralised solar/gas) explicitly permitted

§ 03

Captive power generation above 1MW allowed without a federal licence

§ 04

Mini-grid licensing simplified for off-grid solar developers

§ 05

Net metering for prosumers (sell back to the grid)

§ 06

Mandatory feed-in tariffs for renewable energy + Renewable Energy Certificate market

§ 07

Power Consumer Assistance Fund created for indigent customers

§ 08

Cross-subsidy phase-out (industrial users no longer subsidising residential)

03 What changed in practice

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12 states have established SERCs by mid-2026: Enugu (first, Jan 2024), Lagos, Ekiti, Ondo, Imo, Edo, Plateau, Oyo, Kogi, Niger, Cross River, others

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Band A tariff raised from ₦68/kWh to ₦225/kWh (April 2024) for premium 20-hour customers

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Federal subsidy bill projected to fall ₦3.4tn/yr → ₦1.1tn/yr

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Lagos State Electricity Market — first state to formally exit federal grid jurisdiction (2024)

04 Who it affects

Power consumersState governmentsDisCosSolar developersIndustrial users

Official source

NERC — Nigerian Electricity Regulatory Commission

Primary regulator / sponsoring institution ↗

Use this law on the site

See power-sector projects under infrastructure

Cross-linked tool that operationalises this Act

05 What it repealed / replaced

Electric Power Sector Reform Act 2005 (EPSRA)