Almost three years after Nigeria enacted the Electricity Act 2023, many states are still struggling to translate the landmark reform into functioning electricity markets, raising fresh concerns over the pace of implementation and the future of decentralised power supply in the country.
The law was introduced to break the long-standing federal monopoly in the electricity sector by allowing states to generate, transmit and distribute power independently within their territories. It was also designed to encourage investment in renewable energy, embedded generation and mini-grid projects capable of improving electricity access across urban and rural communities.
While the reform was widely hailed as a turning point for Nigeria’s troubled power sector, findings show that progress across several states has remained uneven, with many governments yet to establish fully operational electricity regulatory commissions or publish detailed energy transition plans.
So far, states including Lagos State, Enugu State, Ekiti State, Ondo State and Oyo State have taken visible steps towards building independent electricity markets through new legislation, regulatory structures and investor engagement initiatives.
Lagos has emerged as the most aggressive player, unveiling plans for embedded power projects targeted at industrial hubs, public infrastructure and underserved communities outside the fragile national grid.
Enugu State recently inaugurated the Enugu State Electricity Regulatory Commission after domesticating the Electricity Act, while Ekiti and Ondo states have also initiated frameworks to support renewable energy and off-grid electrification projects.
Despite these developments, several states remain largely at policy discussion stages, with little evidence of implementation capacity, funding structures or commercially viable electricity projects.
Industry stakeholders say the slow pace reflects deeper structural challenges, including weak technical expertise, inadequate financing, regulatory uncertainty and poor coordination between federal and state authorities.
According to data from the Nigerian Electricity Regulatory Commission, Nigeria still generates less than 6,000 megawatts for a population exceeding 200 million, forcing millions of homes and businesses to depend on expensive petrol and diesel generators.
Nigeria also continues to suffer repeated national grid collapses, worsening pressure on manufacturers, small businesses and households already battling rising energy costs.
Power sector experts argue that decentralisation alone cannot solve Nigeria’s electricity crisis unless states move quickly to establish transparent regulatory systems capable of attracting private investment.
Chairman of the Nigerian Electricity Regulatory Commission, Sanusi Garba, recently stressed the need for states to create stable and investor-friendly electricity markets rather than simply passing new laws.
Analysts say investors are watching closely to see whether states can provide clear tariff structures, protect investments and build commercially sustainable electricity systems.
Beyond state-level reforms, regulators are also developing frameworks that would allow consumers with rooftop solar systems to sell excess electricity back to the national grid through net-metering arrangements.
Energy experts believe the initiative could accelerate solar adoption across Nigeria, especially as rising diesel and petrol prices continue to push homes and businesses towards alternative energy sources.
Manufacturers and business groups have repeatedly identified unreliable electricity as one of the biggest constraints to economic growth in Nigeria, with many companies spending heavily on self-generation to remain operational.
For now, the Electricity Act remains one of Nigeria’s boldest power sector reforms in recent years. But the success of the policy may ultimately depend not on the number of states passing electricity laws, but on how quickly ordinary Nigerians begin to experience stable and affordable electricity supply.
