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This essay assesses the National Integrated Electricity Policy (NIEP), presented by Minister of Power, Chief Adebayo Adelabu and approved by President Bola Tinubu at the meeting of the Federal Executive Council on Monday, 5th May 2025. It evaluates the NIEP’s capacity to serve as a foundational instrument for achieving energy security in Nigeria, in terms of its content and its anticipated implementation challenges.
Chapter 1 traces Nigeria’s journey from the OBJ-era National Electric Power Policy (NEPP) (2001) through the Electric Power Sector Reform Act (EPSRA) 2005, culminating in the 5th Alteration to the 1999 Constitution, 2023 and the Electricity Act 2023. That journey traced the evolution from a centralised, Federal Government (FG)-run model to a private sector-led, multi-level market comprising the FG-regulated National Wholesale Electricity Market (NWEM) based on the national transmission grid and the 23 generation companies connected to it, on one hand; and the various State-regulated electricity distribution markets in the 36 States of the Federation; a structure enabled by the 5th Alteration, to the 1999 Constitution, 2023 that removed the constraint that previously hindered the ability of the States to establish State electricity markets for themselves.
Chapter 2 sets ambitious targets for universal access by 2030 and stipulates the Nigerian Electricity Supply Industry’s (NESI’s) key objectives as being Healthy Capitalisation, Universal Access and Electricity Reliability. The Chapter also identifies several key constraints, namely, inadequate generation, over-reliance on diesel generation and poor transmission infrastructure. It proposes reforms including investment in firm gas supply, the delivery of a SCADA/EMS system for the national grid and the development of resource planning and reliability assurance strategies via a National Integrated Resource Plan (NIRP) the preparation for which, incidentally, Minister Adebayo Adelabu adopted in October 2023, and the Plan was subsequently developed during the intervening 18 months, completed and launched in January 2025.
Chapter 3 defines a three-tier market structure, the first tier being the National Wholesale Electricity Market (NWEM) for bulk electricity trading, comprising the national 330kV and 132kV transmission grid and the 23 Generating Companies (Gencos) connected to this grid. Next, State Electricity Markets (SEMs), for the various for intra-state electricity distribution activity, of which there are potentially 37 covering each State and the FCT (10 of these are already setting up). In these markets, electricity is generated entirely within the State for delivery to distribution licensees selling exclusively to customers in the State. Many Nigerian States would also be populous and/or large enough to warrant an intra-State transmission grid to be licensed and built. The third tier comprises (State-based) Off-grid Markets, also State-based that are focused on the many underserved and completely unserved areas of the States to which it would not be economically sensible to extend the national or State transmission grid. Chapter 3 recommends various competitive market mechanisms and private investment incentives that the Federal and State Governments may adopt. It also establishes a basis for coordination between Federal and State regulators, which already has legislative effect in Section 230 (9), Electricity Act, 2023.
Chapters 4 recognises and discusses initiatives and programmes that, while not being directly engineering-related, implicate the various cross-cutting fields that directly impact the country’s ability to achieve energy security. Chapter 4 outlines Nigeria’s climate obligations and net-zero goals to be attained by the universally accepted 2060 target date. This is anchored on a Nigerian Energy Transition Plan, the Climate Change Act 2021, and renewable energy deployment. It emphasises decarbonisation of transport, clean cooking and emissions reduction in oil and gas.
Chapter 5 focuses on the vital element of human capital development that is often the Achilles heel of many a reform project. It advocates professional and technical training, technology integration, partnerships for training facilities and robust M&E systems. Chapter 6 recognises the damage done by unequal access and systemic exclusion of women, PWDs, and the rural poor. It proposes gender-responsive policy design, subsidy schemes, and monitoring frameworks to close access and equity gaps. Chapter 7 encourages the localisation of supply chains and technologies by incentivising local production and technology transfer, setting measurable local content benchmarks, and promoting manufacturing to enhance sectoral competitiveness. The next and final Chapter addresses the constitutionally mandated transition to devolved State electricity markets. It proposes a cooperative regulatory transition from NERC to State-level Commissions via collaborative NERC-to-State transition processes regimes and an institutionalised process of developing State Integrated Resource Programmes (IRPs), just as the Federal Government has done.
Strengths
In terms of strengths, the Policy demonstrates coherence in the sense of its alignment with the Electricity Act 2023. This ensures that the NIEP is established as a legally credible, inclusive and practical framework for implementing national electricity sector objectives. Thus, targets regarding universal access, improved reliability and decarbonisation are framed within implementable strategies like IRPs, fiscal incentives, and off-grid market development. Also, for the first time since 1960, Nigeria’s federal structure is respected and recognised in the sector. Consequently, the States are treated as primary actors in electricity market governance with State having unique needs that are best addressed by locally adapted policies, market designs, rules and regulatory tools.
Furthermore, the Policy correctly prioritises human capital development and local manufacturing, which are essential in establishing domestic supply chains for long-term sustainability, energy security and job creation. It also brings focus to Nigeria’s energy transition and its climate obligations and makes clear provisions for clean energy and social inclusion, which are essential for equitable and sustainable development.
Weaknesses and Risks
We must also address the potential risks with the implementation of the Policy. First is Nigeria’s historical challenge – implementation gaps arising out of poor policy execution and bureaucratic inertia. Despite traditionally strong initial intent, Nigeria has historically struggled with execution and so implementation of prior sector reform programmes set out in the Nigerian Electric Power Policy, 2001, the EPSRA, 2005 and the 2010 Road Map to Power Sector Reform were all hobbled by deliberate bureaucratic delays, weak accountability and M&E mechanisms and indifferent political support to drive the firm and sustained implementation of agreed reforms.
These risks have consistently dogged the pace and quality of sector reform causing the NESI to lack quality long-term capital; in turn driving the Federal and State public sectors to continue to be involved in funding the sector through poorly administered subsidies, grants and loans. The lack of the required massive capital mobilisation from the private sector and development partners, essential to network expansion and the attainment of universal access is exacerbated by the continued financial insolvency in the NESI and the attendant perceived high risk perceptions that deter the accretion of capital/project finance into the Sector.
Yet another issue is the danger of setting ambitious timelines. Particularly, important goals such as universal access by 2030 and net-zero by 2060 would be much easier to attain if we connect them to programmes of detailed reforms in commercial arrangements that underpin the gas-to-power value chain; undertake major restructuring of management and financing arrangements for the national transmission infrastructure; and robust State-level readiness and coordination. Happily, the statutory mandate to follow the NIEP with a SMART Strategic Implementation Plan (SIP) is now the immediate task ahead of the Minister and in doing so the programme management mistakes of the past will be avoided or at least considerably mitigated.
There is also the question of limited human capacity that possesses experience, technical readiness and a grasp of the diverse issues, in terms of policymaking, regulation and PPP engagement, at State level. Whatever one may think of the deficiencies in this regard at national level, it is replicated even more across the board at State level. For all the States, the transition from NERC to State regulation is a complex process for which they are largely unprepared. State-level executives lack experience in electricity market regulation and have not had cause to consider the diverse market design and physical framework establishment issues before them. State regulatory entities are mostly not established or, if established, are grossly underfunded and/or improperly funded and are exposed to political capture, investor hostility and apathy by Federal authorities who should be supporting them. This is a risk that will be mitigated and ultimately largely eliminated only by deliberate and institutionalised close coordination between Federal and State regulators to help set the principles, issues, standards and tasks that make up the establishment of a credible State electricity market and regulatory transition process; and by establishing a continuing education platform that will produce a steady stream of Federal, State and private sector executives across all management levels.
Again, while the Policy recognises that consumer protection is constitutionally a residual matter, and therefore the responsibility of the States, there is no clear national framework to standardise State-level consumer protection and education practices. While the consumer protection function is covered currently at national level by the Federal Competition and Consumer Protection Commission, the absence of a national standards framework will likely lead to uneven regulation and service quality due to licensees engaging in regulatory arbitrage, tariff manipulation, which ultimately leads to inconsistent and diminished service standards.
Conclusion
Objectively viewed, the National Integrated Electricity Policy (2024) is a bold and necessary blueprint that provides Nigeria with a comprehensive and contemporary roadmap to transform its electricity sector. It is technically sound, institutionally grounded in law, and holistic in scope. Now that this has been approved, it will be followed, as required by the Electricity Act, 2025, by a realistic, well-sequenced Strategic Implementation Plan (SIP). Expectedly, the SIP will be pragmatically and competently executed to ensure that the key building blocks of the NESI’s growth are brought to bear, including State-level preparation for market responsibility, effective coordination between amongst and between Federal and State actors, mobilisation of both public and private capital, and sustained, disciplined political will to drive reform implementation.
Eyo O. Ekpo is the Team Leader, Power, United Kingdom Nigeria Infrastructure Advisory Facility. He is formerly the Commissioner for Market Competition and Rates, NERC (2010-2015)
