NERC Moves to Finalise Mini-Grids’ Regulation

NERC Moves to Finalise Mini-Grids’ Regulation In line with Sections 96(1) and 70(8) of the Electric Power Sector Reform(EPSR) Act 2005 (Act No.6 of 2005), which empowers it to make regulations, the Nigerian Electricity Regulatory Commission (NERC) has unveiled plans to finalise works on the regulation on mini-grids as part of the efforts to encourage investors and bring electricity to more rural communities.

In order to produce the final regulations, the agency recently commenced a nationwide sensitisation of the various stakeholders on the mini-grids initiative.

Speaking to media in Lagos during a recent public sensitisation on solar power solutions organised by the International Finance Corporation (IFC) and the United Kingdom’s DFID, NERC’s Deputy General Manager in charge of Renewables, Research and Development, Dr. Haliru Dikko stated that the object of the regulation was to boost electricity supply in areas without existing distribution network, better described as ‘unserved areas,’ and areas with an existing but poorly electrified or non-functional distribution grid, also known as ‘underserved areas’.

Dikko said the regulation would attract participation of private sector, communities, non-governmental organisations for the electrification of Nigerian communities.

“We are going to sensitise the general public on the mini-grid regulations. So, the regulation is to encourage investment in renewables such as solar and biomass without restricting anybody. It is to encourage investors on off-grid, not only in the main grid so that they can bring power to the rural communities at affordable costs and also protect investors who are going to invest in mini-grid. There is no such regulation in place at the moment.

According to him, the regulation provides for permit and tariff approval procedures, which will ease the administrative burden on the mini-grid operator and ensure the process of obtaining the permit in a timely manner.

“The regulation will minimise risks in tariff changes, as tariffs would have been agreed in advance by the relevant parties, as well as other risks to protect consumers and investors,” he added.

NERC had earlier in a statement hinted that the distributed power of the mini-grid would determine the regulatory procedure to be followed.

According to the agency, for distributed power of up to 100kW, a permit is optional for the mini-grid operator; while for distributed power of over 100kW and installed generation capacity of up to 1MW a permit will be required.

However, beyond that limit, a full licence is required which is outside of the scope of this regulation and is taken care of by other already existing Regulations.

A spokesman of Enugu Electricity Distribution Company (EEDC), Mr. Chukwuemeka Ezeh had confirmed the engagement in Enugu will involve NERC and other distribution companies around Enugu, including State Rural Electrification Boards, potential Mini-Grid host communities and operators within the franchise area of EEDC, Port Harcourt Electricity Distribution Company (PHED) and Benin Electricity Distribution Company (BEDC).

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