The Nigeria Electricity Regulatory Commission (NERC) has directed Ibadan Electricity Distribution Company Plc (IBEDC Plc) to incorporate a subsidiary IBEDC SubCo for the assumption of responsibilities for intrastate supply and distribution of electricity in Oyo State from IBEDC.
NERC gave the directive in its Order of August, 2024 jointly endorsed by the NERC Chairman Sanusi Garba and Commissioner Legal, Licensing and Compliance, Dafe C Akpeneye. The Order was issued preparatory to transfer of regulatory oversight of the electricity market in Oyo State from NERC to the Oyo State Electricity Regulatory Commission (‘OSERC”).
OPTIMUM TIMES reports that earlier in June, 2024, NERC had issued a similar order to transfer regulatory oversight of the electricity market in Imo State to the Imo State Electricity Regulatory Commission.
The Order is in line with the new legal framework for Nigeria Electricity Supply Industry (NESI) within which the Commission retains the role as central regulator with regulatory oversight on the inter-state/international generation, transmission, supply, trading and system operations as contemplated by section 63(7) of the Electricity Act (EA 2023).
Further, NERC directed that before transfer of responsibilities to the OSERC expected to be completed by February 5, 2025, the following are to be put in place:
“IBEDC shall complete the incorporation of IBEDC SubCo within 60 days from the effective date of this Order and, IBEDC SubCo shall apply for and obtain a licence for the intrastate supply and distribution of electricity from OSERC.
“IBEDC shall identify the actual geographic boundaries of Oyo State and carve out its network in Oyo State as a standalone network with the installation of boundary meters at all border points where the network crosses from Oyo State into another state.
“IBEDC shall Create an Asset Register of all its power infrastructure located within Oyo State; Evaluate and apportion contractual obligations and liabilities attributable to IBEDC’s operations of its subsidiary in Oyo State; Identify all the applicable trading points for energy offtake for the operations of IBEDC SubCo in Oyo State.
“Confirm the number of employees that are required to provide service to Oyo State as a standalone public utility; and Transfer the identified assets for operations in Oyo State, contractual obligations, liabilities and employees to IBEDC SubCo.
“The Commission shall prepare register of licensees, permit holders, certificate holders and holders of any other authorisations from the Commission in Oyo State. The register shall be delineated along the lines of authorised activities and use of the national grid for their activities.
“A transfer of regulatory oversight notification shall be issued by the Commission to the companies in the register whose activities are limited within Oyo State informing the entities of the transfer/assumption of regulatory oversight for their activities by OSERC.”
Apart from other requirements to be fulfilled, NER directed that all cross-border transactions involving the national grid shall be subject to the approval of it in accordance with the Constitution of the Federal Republic of Nigeria and
Electricity Act.
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