In May 2017, the Honourable Minister for Power, Works and Housing made a policy declaration as to the categories of persons to be regarded as Eligible Customers in the Nigerian Electricity Supply Industry (NESI) pursuant to Section 27 of the Electric Power Sector Reform Act, 2005 (EPSRA or the Act) (the Declaration). With the Declaration, successor electricity Generation Companies (Gencos) and Independent Power Producers (IPPs) would be able to by-pass the Bulk Trader (the Nigerian Bulk Electricity Trading Plc (NBET)) and sell electricity directly to Eligible Customers. Since the Declaration was made in May, there has been some uncertainty as to manner of its implementation and its overall effect on the NESI.
Further to the Declaration, the Nigerian Electricity Regulatory Commission (NERC or the Commission) has now issued the NERC Eligible Customer Regulations, 2017 (the Regulations) in exercise of its powers under Section 96 of the EPSRA.
In addition to setting out the registration regime applicable to Eligible Customers envisaged by the Declaration, the Regulations adopt a phased approach to the introduction of declared classes of Eligible Customers as a first step to spawning retail competition and the licensing of traders in the Medium Term Market, and reflect a regulatory intent to promote third party access to distribution and transmission networks.
