Opinion
Beyond Legal Reform On Power Sector (1)
Following the recent constitutional amendment assented to by President Muhammadu Buhari, the power sector regulatory body- the Nigerian Electricity Regulatory Commission (NERC) now has powers to grant States license to generate, transmit and distribute electricity. Prior to the review, the 1999 Constitution of the Federal Republic of Nigeria (as ammended) in Articles 13 and 14 though positioned electric power in the concurrent legislative list for federal and state governments to legislate on electricity matters, however, restrained the powers. The states then were only permitted to interfere in areas not covered by the national grid system within that state. Interestingly, the recent amendment reviewed Article 14(b) and liberally expands the powers of states to generate, transmit and distribute electricity to areas covered by the national grid unlike pre-reform regimes. What then are the implications of the powers extended to the states to generate electricity even in areas covered by the national grid?
For decades and even with the privatisation of the sector in 2013, the electricity value chain, especially transmission and distribution are literally monopolistic. The reason for this is that even when the electricity value chain has been unbundled and components privatised, the value chain remains highly integrated due to the nature of the electricity product. Electricity in the form of electrons travels at the speed of light from generation to consumption points. Without integration, the disruptions due to poor coordination between components of the value chain can result in poor delivery.
In developed utilities, competitiveness has been introduced through market and regulatory reforms which facilitate consumers to select their preferred generators depending on tariff differences. Advanced metering technology makes this possible. More recently technological innovations are creating opportunities for households and electricity consumers to explore self-generation options apart from public grid systems. The available options range from conventional generators, solar and wind generators. An important incentive for self-generation is that the deployed smart metering solutions facilitate the sale of excess self-generated power back to the grid.
The liberalisation of the states to generate, transmit and distribute electricity has subtly de-monopolised the long existing monopoly of the value chain, making way for free competition in the market through states. Possibly, some states will subsequently make investments in the power sector that will give rise to more electricity generation and supply. However, the question is, how much of additional generated power can be accommodated and integrated into the current Nigerian grid system?
Arguably, there may be a dire need for states to massively invest in further strengthening electricity network infrastructure which has been one of the major causes of the unstable poor supply in many parts of the country. There are privately-owned distribution infrastructure that have been in use for over four decades, hence, the need for upgrade. Equally, some government owned power generating plants which are yet to be concessioned and the Transmission Company of Nigeria (TCN) require significant capital outlay in order to upgrade the assets to the growing national power demand. Even if there was sufficient generated electricity, in most cases, those worn-out infrastructure may be incapable of accommodating such load. As such, we see excess generated electricity, unutilised. Modern technology has provided grid support and ways excess energy can be stored and utilised appropriately. This must be explored.
Given all these challenges and emerging opportunities, the most optimal way to leapfrog in the provision of improved reliable electricity, is for the state governments to consider how the potential investors would leverage on existing NERC regulations in third-party investments, franchising and eligible customer regulations before awarding investments in generation, transmission and distribution to new entrants. This way, legal hitches in utilising existing infrastructure which are privately owned can be avoided.
Depending on how the states intend to operate, the synergy between existing investors and new entrants would open up massive novel opportunities and would also see a rise of prosumers. This means producing consumers; if states allow individuals with capacity to generate their own power and distribute. This can be a good foundation to usher in clean renewable energy sources. In countries like the United Kingdom, innovative incentives (though limited in time) like feed in tariff, renewable obligation certificates were created to encourage generation of clean power through renewable sources by individuals, small and big companies alike. In fact, in the UK, some incentives like Contract for Difference, Smart Export Guarantee, Renewable Heat Incentises, etc. that encourage, support and incentivise the generation and distribution of clean energy through renewable sources are still operational.
Additionally, job creation and employment opportunities will also be a consequence of the implementation of the powers of the state. The underlying economic, social and financial advantages that would result from this are enormous. Thus, liberalising the states to generate, transmit and distribute electricity is a step in the right direction.
On the other hand, with all the positive impacts this recent amendment would likely bring to the sector, the future of existing GenCos, Transmission Company of Nigeria (TCN) and DisCos remain uncertain. With the previous monopolistic nature of the value chain, the sector battled liquidity crises, etc. Operating within an open market structure, leaves the fate of these market operators uncertain. States operating their own transmission networks may imply that the TCN which is the only body in the value chain that is 100 percent government owned and not privatised is now decentralised.
Furthermore, human capital flight may also be one of the setbacks that the current market operators may experience as states would source experienced and capable individuals to manage the state power investments. Declining collection efficiency may also be experienced especially where consumers are at liberty to switch from one electricity company to another. Consequently, the modalities for operations of the state with respect to generation, transmission and distribution of electricity must be clearly stated by NERC, the regulator. NERC may have more work to do in terms of providing innovative guidelines for customers to switch or migrate from one network to another and not just allow it to be solely an internal affair of the state.
According to the World Bank, “Nigeria has the largest number of people without access to electricity in the world”. The World Bank further states that “the power sector has not been able to keep up with demand or provide reliable supply to existing customers. Businesses in Nigeria lose about US$29 billion annually because of unreliable electricity”.
Optimistically, with the implementation of this reform by states, especially if renewable energy sources are incorporated, Nigeria may witness a record decline in the number of people without access to electricity as well as see significant improvement in electricity supply, and ultimately boost the economy. However, the success is dependent on implementing business models that would promote synergy and collaboration between the existing distribution investors and the new entrants to avoid potential rivalry that could lead to legal hitches.
Ani is a Lawyer & Renewable Energy Expert, and reachable through email: nkemani2011@yahoo.comBeyond Legal Reform on Power Sector.
By Ani Nkemjika Nnenne
Following the recent constitutional amendment assented to by President Muhammadu Buhari, the power sector regulatory body- the Nigerian Electricity Regulatory Commission (NERC) now has powers to grant States license to generate, transmit and distribute electricity. Prior to the review, the 1999 Constitution of the Federal Republic of Nigeria in Articles 13 and 14 though positioned electric power in the concurrent legislative list for federal and state governments to legislate on electricity matters, however, restrained the powers. The states then were only permitted to interfere in areas not covered by the national grid system within that state. Interestingly, the recent amendment reviewed Article 14(b) and liberally expands the powers of states to generate, transmit and distribute electricity to areas covered by the national grid unlike pre-reform regimes. What then are the implications of the powers extended to the states to generate electricity even in areas covered by the national grid?
For decades and even with the privatization of the sector in 2013, the electricity value chain, especially transmission and distribution are literally monopolistic. The reason for this is that even when the electricity value chain has been unbundled and components privatized, the value chain remains highly integrated due to the nature of the electricity product. Electricity in the form of electrons travels at the speed of light from generation to consumption points. Without integration, the disruptions due to poor coordination between components of the value chain can result in poor delivery.
In developed utilities, competitiveness has been introduced through market and regulatory reforms which facilitate consumers to select their preferred generators depending on tariff differences. Advanced metering technology makes this possible. More recently technological innovations are creating opportunities for households and electricity consumers to explore self-generation options apart from public grid systems. The available options range from conventional generators, solar and wind generators. An important incentive for self-generation is that the deployed smart metering solutions facilitate the sale of excess self-generated power back to the grid.
The liberalization of the states to generate, transmit and distribute electricity has subtly de-monopolized the long existing monopoly of the value chain making way for free competition in the market through states. Possibly, some states will subsequently make investments in the power sector that will give rise to more electricity generation and supply. However, the question is, how much of additional generated power can be accommodated and integrated into the current Nigerian grid system?
Arguably, there may be a dire need for states to massively invest in further strengthening electricity network infrastructure which has been one of the major causes of the unstable poor supply in many parts of the country. There are privately-owned distribution infrastructure that have been in use for over four decades, hence, the need for upgrade. Equally, some government owned power generating plants which are yet to be concessioned and the Transmission Company of Nigeria (TCN) require significant capital outlay in order to upgrade the assets to the growing national power demand. Even if there was sufficient generated electricity, in most cases, those worn-out infrastructures may be incapable of accommodating such load. As such we see excess generated electricity, unutilized. Modern technology has provided grid support and ways excess energy can be stored and utilized appropriately. This must be explored.
Given all these challenges and emerging opportunities, the most optimal way to leapfrog in the provision of improved reliable electricity, is for the state governments to consider how the potential investors would leverage on existing NERC regulations in third-party investments, franchising and eligible customer regulations before awarding investments in generation, transmission and distribution to new entrants. This way, legal hitches in utilizing existing infrastructure which are privately owned can be avoided.
Depending on how the states intend to operate, the synergy between existing investors and new entrants will open up massive novel opportunities and will also see a rise of prosumers. This means producing consumers; if states allow individuals with capacity to generate their own power and distribute. This can be a good foundation to usher in clean renewable energy sources. In countries like the United Kingdom, innovative incentives (though limited in time) like feed in tariff, renewable obligation certificates were created to encourage generation of clean power through renewable sources by individuals, small and big companies alike. In fact, in the UK, some incentives like Contract for Difference, Smart Export Guarantee, Renewable Heat Incentives, etc. that encourage, support and incentivize the generation and distribution of clean energy through renewable sources are still operational.
Additionally, job creation and employment opportunities will also be a consequence of the implementation of the powers of the state. The underlying economic, social and financial advantages that will result from this are enormous. Thus, liberalizing the states to generate, transmit and distribute electricity is a step in the right direction.
On the other hand, with all the positive impacts this recent amendment will likely bring to the sector, the future of existing GenCos, TCN and DisCos remain uncertain. With the previous monopolistic nature of the value chain, the sector battled liquidity crises, etc. Operating within an open market structure, leaves the fate of these market operators uncertain. States operating their own transmission networks may imply that the Transmission Company of Nigeria (TCN) which is the only body in the value chain that is 100% government owned and not privatized is now decentralized.
Furthermore, human capital flight may also be one of the setbacks that the current market operators may experience as states will source experienced and capable individuals to manage the state power investments. Declining collection efficiency may also be experienced especially where consumers are at liberty to switch from one electricity company to another. Consequently, the modalities for operations of the state with respect to generation, transmission and distribution of electricity must be clearly stated by NERC, the regulator. NERC may have more work to do in terms of providing innovative guidelines for customers to switch or migrate from one network to another and not just allow it to be solely an internal affair of the state.
According to the World Bank, “Nigeria has the largest number of people without access to electricity in the world”. The World Bank further states that “the power sector has not been able to keep up with demand or provide reliable supply to existing customers. Businesses in Nigeria lose about US$29 billion annually because of unreliable electricity”.
Optimistically, the implementation of this reform by states, especially if renewable energy sources are incorporated, Nigeria may witness a record decline in the number of people without access to electricity as well as see significant improvement in electricity supply, and ultimately boost the economy. However, the success is dependent on implementing business models that will promote synergy and collaboration between the existing distribution investors and the new entrants to avoid potential rivalry that can lead to legal hitches.
By: Ani Nkemjika Nnenne
Ani is a Lawyer & Renewable Energy Expert, and reachable through email: nkemani2011@yahoo.com
Nigeria, often referred to as the “Giant of Africa”, is endowed with vast natural resources,
a large population and a youthful workforce.
Despite these advantages, the country faces persistent economic challenges, most notably high unemployment rates over the years. Successive governments remain a central issue contributing to poverty, social unrest, and underdevelopment. The economic wellbeing of a nation is significantly tied to her employment levels.
In Nigeria’s case, high unemployment has become a key driver of its poor economic performance affecting everything from productivity and income levels to crime and political instability.
Unemployment in Nigeria has assumed a multidimensional nature, characterised not just by joblessness but also underemployment, informal employment and precarious working conditions.
The Nigeria National Bureau of Statistic (NBS) said the youth with over 60 percent of Nigeria’s population under the age of 30 percent youth unemployment is a time bomb threatening the nation’s future.
Many graduates leave universities and polytechnics annually with little or no hope of securing decent jobs.
This structural unemployment is the result of a mismatch between skills and labour market needs, inadequate industrialisation, and a weak private sector.
Unemployment affects an economy in numerous direct and indirect ways.
In Nigeria, it leads to a reduced consumer base, when large sections of the population are not earning steady incomes, they have limited purchasing power which in turn affects the production and growth of businesses. Companies produce less, invest less and hire fewer people, leading to a vicious cycle of low economic growth.
Moreover, high unemployment translates to lower tax revenue for the government with fewer people paying taxes. The government has fewer resources to fund infrastructure, education, healthcare, and other public services that stimulate economic development.
This fiscal weakness forces Nigeria to rely heavily on foreign loans, which leads to rising debt levels and economic vulnerability.
Furthermore, infrastructure deficits including inadequate power supply, poor road networks and limited access to credit make it difficult for small and medium sized enterprises (SMEs) to thrive, yet SMEs are the bedrock of employment in many developed nations. Nigeria’s weak support for SMEs stifles innovation and job creation.
Another tragic consequence of high unemployment is the mass exodus of Nigerian talent to foreign countries in search of better opportunities. The brain drain weakens the country’s human capital base and deprives it of professionals who could contribute meaningfully to national development.
The “Japa” phenomenon-a slang used to describe young Nigerians fleeing the country reflects deep disillusionment with the system. Doctors, nurses, software engineers and other professionals are leaving in droves. The cost of training these individuals is absorbed by Nigeria, but their expertise benefits foreign economics. This dynamic further deepens the economic challenges as the country loses its best and brightest minds.
Addressing unemployment in Nigeria requires a multifaceted approach, first.
Secondly, industrialisation must be prioritised. The government should create an enabling environment for local manufacturing by improving infrastructure, reducing Bureaucratic bottlenecks and offering tax incentives reviving the agricultural sector with modern techniques and supply chains can also absorb a significant portion of the unemployed.
Thirdly, Governments at all levels must be held accountable for implementing job creation programmes transparently and effectively. Public-Private Partnerships (PPPs) should be encouraged to drive innovations and employment in ICT, renewable energy and logistics.
Finally, Nigeria must diversify its economy away from crude oil and invest in sectors that generate mass employment. Tourism, education, healthcare and creative industries such as film and music hold immense unlapped potential.
With genuine commitment from leaders, strong institutions and the active participation of the private sector and civil society, Nigeria can turn the tide on unemployment and chart a path toward sustainable economic prosperity.
Idorenyi, an intern with The Tide, is a student of Temple Gate Polytechnic
Abia State.
Biana Idorenyin
April 25 every year is World Malaria Day. It was instituted by the World Health Assembly in 2007, “to highlight the progress made in Malaria control, the ongoing challenges that persist and the urgent need for sustained investment and innovation”. This year’s theme, “Malaria Ends with Us: Reinvest, Reimagine and Reignite”, is apt considering the loss of lives incurred and money spent to treat and prevent Malaria. The theme is a clarion-call to intentionally end the malaria scourge through robust commitment of human and financial resources.
That is why one of the best policies, of the suspended Sir Siminalayi Fubara’s administration in Rivers State, was the avowed commitment to check the malaria menace and its multiplier consequences on the residents of the State, through its “Free Malaria Testing and Treatment” innovation.
Rivers State is a microcosm of Nigeria in terms of residents; thus the secularity of the State makes the programme’s beneficiary all-inclusive.
No doubt, the Rivers State Government has by this initiative reinforced value placement on the lives of the people, especially the less-privileged in the State. Residents in Rivers State can now be tested and treated free for Malaria in any Rivers State Government- owned hospitals and healthcare centres across the 23 Local Government Areas of Rivers State. This is a lofty and laudable programme because of the prohibitive cost of malaria drugs and conducting tests at a time majority of Nigerians hardly have a meal to eat, because of the prevailing economic hardship in the country.
Malaria and Typhoid, according to medical and health statisticians are the commonest ailments people suffer as a result of dirty environment, absence of good drainage, lack of potable water. The State Government’s Malaria programme is, therefore, not just a big financial relief but also a life-saver for the teeming poverty-ridden population of Nigeria resident in Rivers State.
According to statistics reeled out by the Federal Ministry of Health and Social Welfare, “Globally, there are an estimated 249million malaria cases and 608,000 malaria deaths among 85 countries”. Such reports leave much to be desired in a nation so blessed with natural resources and manpower. This is why the Rivers State Government should be commended for defying the huge financial implications to drive the lofty programme for Nigerians and foreigners in Rivers State who are availed the privilege of accessing the largesse in all State Government health and medical facilities.
As the Rivers State Government deemed it necessary to initiate the Free Malaria Testing and Treatment programme, nothing stops the Federal Government from doing the same. But even with abounding natural and human resources in unimaginable quantity in Nigeria, Malaria programmes are either grossly underfunded, or funds for the programmes are misappropriated or embezzled with impunity.
In Nigeria, malaria is one of the leading causes of death of children under the age of six and pregnant women. Malaria is a nightmare in Nigeria so much so that price of its drugs and treatment have skyrocketed like a phoenix and outrageously outside the reach of the teeming less privileged citizens of Nigeria. The situation was so alarming that the National Assembly, in 2023 urged the Federal Government to declare Malaria an emergency in Nigeria as a matter of urgent national interest. I am not sure that has been done by the Federal Government because it seems to be in the interest of the common citizens.
Experts have recommended new approaches to fighting the malaria epidemic in Nigeria which seems to have defied continuous attempts to reduce the Malaria burden in Nigeria to zero.
According to a Senior Associate at the John Hopkins Bloomberg School of Public.Health, Soji Adeyi, Nigeria should begin to increase internal funding.for malaria elimination.
According to him,, “Each year reliance on external funding needs to be reduced. I looked at the summary of Malaria reports from 2008 till now and what has been common is the complaint about the lack of funding. If this is a recurring problem, what should be done is to find a new approach “.
In his view, Abdu Muktar, National Coordinator of the Presidential Healthcare Initiative, called for the local production and manufacturing of medical supplies as well as reducing Nigeria’s dependence on drugs imports.
According to him, the local production of anti-malaria and.related.medication will consider.the peculiarity of the country’s terrain, population and burden and.would improve access to effective treatment.
For his part, the regional. Director of World Health Organisation (WHO), African Region, Matshiddiso Moretti, advised Nigeria to accelerate its efforts to end Malaria by relying on adequate data for the implementation of health policies.
Malaria is an epidemic more devastating than the dreaded HIV/AIDS. Malaria triggers high blood pressure and places HIV/AIDS patients on a critical condition. The Federal and sub-national governments should therefore declare Malaria an emergency and prioritise attention to its treatment, production and importation of drugs and vaccines to stem the malaria menace.
The Federal Government should also improve incentives and remuneration of medical and health workers to end their exodus abroad in droves, for greener pastures.
Igbiki Benibo
The traditional institution is as old as human society. It predates the advent of modern organised society. Before the emergence of modern justice system of dispute resolution and political system of administration, the traditional institution has existed long ago. In fact, it was so revered and regarded as sacred because of the mythological conviction that it was the “stool of the ancestors”. Consequently, judgment given was deified as many people especially the traditionalists believe it was the mind of the gods revealed. Perversion of justice , in the pre-modern justice system was alien and considered uncommon. Chiefs and traditional rulers though may not have generated knowledge formally (through the four walls of a classroom), yet they embody and exemplify knowledge. They hold fast the virtue of integrity and honour, fairness and relative impartiality, partly because they believed that the stool they occupy was ancestral and traditional as act of indiscretion can court the wrath of the gods at whose behest they are on the traditional saddle of authority.
The Compass of Life stated unequivocally that “the throne is preserved by righteousness”. Where righteousness, integrity and honesty are savoured,and valued, perversion and miscarriage of justice is an anomaly. The judgments of traditional rulers and chiefs were hardly appealed against because they were founded on objectivity, fairness, truth and facts beyond primordial sentiment and inordinate interests or pecuniary benefits. Judgments were precedent. Traditional rulers and chiefs, therefore carved a niche for themselves, earning the respect of, and endearing themselves to the heart of their subjects. Is it the same today? Some traditional rulers and chiefs are administering their communities in exile; they are diasporic leaders because they have lost the confidence of the people through self-serving, raising of cult group for self-preservation, land grabbing and other flagrant corrupt practices.
When truth is not found in the traditional institution that, in my considered view, constitutes the grassroots government, then crisis is inevitable.In most African societies before advent of the Christian Faith, and consequent Christening of the traditional stools in many communities in recent times, ascent to the traditional institution was a function of a traditional method of selection. It was believed that the gods make the selection. And whoever emerges from the divination processes eventually is crowned as the king of the people after performing the associated rituals.Whoever lacked the legitimacy to sit on the throne but wanted to take it forcefully, traditionalists believed died mysteriously or untimely. Traditional rulers wielded much influence and power because of the authority inherent in the stool, the age of the person designated for the stool notwithstanding. The word of the king was a law, embodied power. Kings so selected are forthright, accountable, transparent, men of integrity, did not speak from both sides of the mouth, could not be induced with pecuniary benefits to pervert justice, they feared the gods of their ancestors and were consecrated holistically for the purpose dictated by the pre and post coronation rituals.
Some of those crowned king were very young in those days, but they ruled the people well with the fear of the gods. There was no contention over who is qualified to sit or who is not qualified to. It was the prerogative of the gods. And it was so believed and upheld with fear.Kings were natural rulers, so they remained untouchable and could not be removed by a political government. If a king committed an offence he was arrested and prosecuted according to the provision of the law. But they have immunity from sack or being dethroned because they are not political appointees. However, the people at whose behest he became king reserved the power to remove him if found guilty of violating oath of stool. The traditional institution is actually the system of governance nearest to the people. And kings were the chief security officers of their communities. So indispensable are the roles of kings and traditional rulers to the peaceful co-existence of their people, ensuring that government policies and Programmes were seamlessly spread to the people that many people are clamouring for the inclusion of definite and specific roles in the Constitution for the traditional institution.
Traditional rulers are fathers to every member of their domain. So they are not expected to discriminate, show favouritism. By their fatherly position traditional rulers, though can not be apolitical, are also expected to be immune from partisan politics. This is because as one who presides over a great house where people of different political divide or interest belong, an open interest for a political party means ostracisation of other members of the family which could lead to disrespect, conflict of interest, wrangling and anarchy. Traditional rulers are supposed to be selfless, preferring the interest of their people above their personal interests following the consciousness that they are stewards whose emergence remains the prerogative of the people. The position is essentially for service and not for personal aggrandisement and ego massaging. So they should hold the resources of the people in trust. However, in recent past the traditional institution has suffered denigration because of unnecessary emotional attachment to political parties and political leaders. Some traditional rulers and kings have shown complete disregard to the principle of neutrality because of filthy lucre and pecuniary gains, at the expense of the stool and people they lead. Sadly some traditional rulers have been influenced to pervert justice: giving justice to the offender who is rich against the poor.
Traditional leaders should be reminded that the “throne is preserved by righteousness”, not by political chauvinism, favouritism, or materialism.Traditional rulers should earn their deserved respect from political leaders by refusing the pressure to be subservient, beggarly, sycophantic and docile. Traditional leaders have natural and permanent leadership system, unlike the political leadership that is transient and tenured.They should be partners with every administration in power and should not be tied to the apron string of past leaders whose activities are aversive to the incumbent administration and thereby constituting a clog in the development of the State and the community they are to woo infrastructure development to. It is unpardonable error for a traditional ruler to have his conscience mortgaged for benefits he gets inordinately from any government.It is necessary to encourage kings and traditional rulers to not play the roles of stooges and clowns for the privileged few, political leaders. Political leaders are products of the people, even as every government derives its legitimacy from the people.
No doubt, the roles of traditional rulers are so necessary that no political or military government can operate to their exclusion. This is why the 10th National Assembly mulled the inclusion of Traditional institution in the proposed amendment of the Constitution of the Federal Republic of Nigeria.Traditional rulers and chiefs should, therefore, be and seen to be truthful, forthright, bold, courageous, honest and people of integrity, not evasive, cunning, unnecessarily diplomatic and economical with truth.The time to restore the dignity of the traditional institution is now but it must be earned by the virtuous disposition of traditional rulers and chiefs.
Igbiki Benibo