by Sola-Alimi Zion Ademurewa and Oyinloye Titus Oluwaseun
Abstract
The concept called Separation of powers is enshrined in the constitution of the federal republic of Nigeria for the purpose of seamless dispensation of governance from each of the three arms of government. Unfortunately, this critical concept is not well exercised in Nigeria. There have been quite a lot of discrepancies as to whether the state governments have the power to legislate on power sector matters as it relates to their states. The roles have been assigned in the constitution of the country but it is as though the state governments have not exploited the provision responsibly enough in order to take control of their own power sector. This article will be reviewing the reasons why each state should take care of its own power sector as enshrined in the constitution for state regulation of electricity. The article will also look into the reasons why lawyers are needed in the Electricity sector of the state as well as suggest other ways by which electricity can be regulated in each state of the Nigerian federation.
INTRODUCTION
The President of the Federal Republic of Nigeria signed in March 2023, 16 constitutional amendment bills into law, including “the Constitution of the Federal Republic of Nigeria (Fifth Alteration) Bill, No. 33, 2022” – (the Fifth Amendment”). The Fifth Amendment effectively amended the Constitution of the Federal Republic of Nigeria 1999 (as amended) (the “Constitution”) to empower States within the Federation to make laws concerning the generation, transmission, and distribution of electricity in all areas of each State, including areas covered by the national grid. This decentralises electricity regulation in areas already covered by the national grid.
The Fifth Amendment represents a volte-face from the 1999 constitutional position, which restricts the States from legislating on areas covered by the grid. To distil the implications of the new amendment, we will briefly explore how the issue of electricity has been treated under previous Nigerian constitutions and then analyse the constitutional issues thrown up by the recent amendments
THE CONSTITUTIONAL BASIS OF REGULATION OF ELECTRICITY BY STATE GOVERNMENTS
The concept of decentralization was well spelt out in the constitution which provides that power is to be shared between the state and its component units but quite unfortunately, it seems as though the state closed its eyes to the need for effectual regulation of electricity. However, it could be said that some legislators are either ignorant of the provision or they have misinterpreted it. For the sake of clarity, the provision is stated below as provided in paragraph 13 and 14 of Part II of the Second Schedule of the CFRN 1999;
13. The National Assembly may make laws for the Federation or any part thereof with respect to-
(a) electricity and the establishment of electric power stations;
(b) the generation and transmission of electricity in or to any part of the Federation and from one State to another State;
(c) the regulation of the right of any person or authority to dam up or otherwise interfere with the flow of water from sources in any part of the Federation;
(d) the participation of the Federation in any arrangement with another country for the generation, transmission and distribution of electricity for any area partly within and partly outside the Federation;
(f) the regulation of the right of any person or authority to use, work or operate any plant, apparatus, equipment or work designed for the supply or use of electrical energy.
14. A House of Assembly may make laws for the State with respect to –
(a) electricity and the establishment in that State of electric power stations;
(b) the generation, transmission and distribution of electricity to areas not covered by a national grid system within that State; and
(c) the establishment within that State of any authority for the promotion and management of electric power stations established by the State.
But is quite understandable due to the recent amendment i.e. the Fifth Alteration Act 2023 which altered the Second Schedule to the Principal Act is altered in Part II, paragraph 14 (b), by deleting after the word “areas” the words “not covered by a national grid system”. Therefore, the Fifth Amendment is a reversal to the pre-1999 constitutional position where the States have the liberty to make laws concerning the generation, distribution and transmission of electricity in all areas of their States, whether or not there is a national grid system in place.
In the initial provision of the Constitution, it precluded the State government from making laws as regards electricity regulation or any other thing that relates to it. The initial provision provided that:
14. A House of Assembly may make laws for the State with respect to
a. electricity and the establishment in that State of Electricity Power Stations;
b. the generation, transmission and distribution of electricity to areas not covered by a national grid system within that state.
c. the establishment within that state of any authority for the promotion and management of electric power stations established by the State.
The practical implication of the Fifth Amendment is that States are no longer restrained from making laws to regulate and license the generation, distribution and transmission of electricity. This is also with respect to areas covered by the national grid. Owing to this, the state government across the country have been saddled with the responsibility of ensuring the proper regulation of electricity.
AN OVERVIEW OF LAGOS STATE POWER REFORM ACT (ESPRA) AS A CASE STUDY
A few years back, in seeing the need for the regularization of electricity by each state as provide for in the Second Schedule section 14b of the Constitution of the Federal Republic of Nigeria, the Lagos State House of Assembly then passed the Lagos State Electric Power Sector Reform Law (the “Law”) and same has been assented to by the Governor. The law that was established was made to point out to boost power supply in Lagos State which they perceived could be achieved through the foundation of an implanted control plot and the creation of offenses for energy theft. The Lagos state government realized that certain things had to be laid down before they can regulate the electricity of their sate and prohibit any form of criminal offences that could arise from their apathy of good and proper management. The following are some of the major things that the Lagos State Electric Power Sector Reform Law introduced;
- It introduced the requirements for;
- all institutions intending to operate power plants with a capacity that is greater than 1 megawatt in the State to seek approval from The Lagos State Electricity Board (the “Board”);
- That all power plants must be registered by the Board.
- It established new entities such as the Lagos State Electricity Board (the “Board”), the Lagos State Embedded Power Council, and provision of additional powers to the Ministry of Energy and Mineral Resources (the “Ministry”) for the implementation of the Law;
- It mandated the Lagos State government to liaise with the Nigerian Electricity Regulatory Commission to establish special cost reflective tariffs for power projects under the Embedded Power Scheme;
- It brought forth an embedded power stabilisation fund into which a levy of 2% of the tariff payable by consumers under the Embedded Power Scheme will be paid into, and also the establishment of a power fund management company (which could most preferably be a private sector) to oversee the management of the fund;
- It introduced various kinds of electricity offences including offences for, (i) unlawful connection of electricity lines or cables, (ii) meter tampering, (iii) diversion of electricity, (iv) destruction of electric meters equipment, (v) lines, supplying of electric power without a license, (vi) dealing with unauthorized network/infrastructure, (vii) obstruction of officials of electricity companies who are carrying out their lawful duties, amongst others. A power task force is also established under the Law for the enforcement of the Law;
SUGGESTED WAYS BY WHICH THE STATE GOVERNMENTS CAN REGULATE ELECTRICITY
- LICENSING OF GENERATION, TRANSMISSION, AND DISTRIBUTION: With the decentralization of the generation, transmission and distribution of electricity in the Electricity Act 2023, state governments can now regulate, transmit and distribute electricity. This wasn’t the case in the EPSRA) of 2005[1] as generation, transmission and distribution of electricity was more centralized while the over reliance on the Federal government for the generation, distribution of electricity has hampered economic growth and development in the sector quite tremendously. This landmark legislation allows states to now create their own electricity market structures and regulatory authorities, issue licenses for electricity generation, transmission and distribution leading to increased localized control and decision-making in the power sector rather than relying solely on federal authorities. Let’s analyse how this decentralization can help the state regulate electricity therefore promoting economic growth and enhancing healthy competition.
Before a company can generate, sell or transmit electricity, it must be issued a license after its application. Section 71 of the electricity act 2023 is to the effect that an application for a license must be issued to the commission as may be prescribed by the Commission accompanied by the prescribed fee. Licensing is the formal approval that allows entities to engage in activities related to electricity generation, transmission, and distribution. Licensing in the electricity sector takes different forms like;
- License to generate electricity: this permits entities to produce electricity
- License to transmit electricity: it enables operators to construct and manage the infrastructure needed to transport electricity over long distances.
- License to distribute electricity: this permits companies to supply light to end users for consumption of electricity.
States can regulate their electricity markets by issuing licenses to private investors who can operate mini-grids and power plants within the state. However, the Act precludes interstate and transnational electricity distribution.[2]
It is important that we have this licensing framework as it promotes efficiency and safeguards consumer rights. For the generation and distribution of electricity, such companies have been privatized but the government still owns transmission companies[3]. By delegating the power and right to states to issue license for the generation, transmission and distribution of electricity, the Act now promotes a more decentralized approach to energy management, enabling the state governments to attract investments and develop tailored solutions for electricity supply. States are now responsible for overseeing compliance with service quality, safety, and environmental standards, ensuring that licensed entities operate within the regulatory framework.
The licensing procedures under Section 71 of the Electricity Act can be distilled into the following five key points, which outline the essential steps involved in obtaining a license
- Application Submission: Applicants must submit to the Commission relevant documents, prescribed fees and license application.
- Public Notice Requirement: applicants must within 30 days of applying, publish in local newspapers and national newspapers a notice of their application informing the public about the opportunity to submit objections or representations regarding the application.
- Disclosure of Interests: Applicants must disclose any significant ownership interests (greater than 10% or as specified by the Commission) in other licensed entities to ensure transparency and avoid conflicts of interest
- Assessment Criteria: The Commission will access the application based on compliance with relevant provisions of the Act, including standards and codes of conduct. The license will only be granted if it is deemed to be in the public interest.
- Timelines for Processing: The Commission is mandated to notify the applicant about the adequacy of the application documents within one month and to reach a decision (approval or denial) within six months. Simplified procedures may be established for smaller businesses to expedite the process.
The legal authority vested upon the state, allows state government to regulate electricity activities within their territories, addressing local needs and fostering economic development. Section 63 sub 1 of the Electricity Act 2023 is to the effect that states have the right to
” Make laws and establish markets for the generation, transmission, system operation, distribution and supply of electricity within their respective territories…”
Section 2 sub-2[4] further solidifies the authority of state governments to independently regulate and manage their electricity sectors without federal interference. It specifically states that State government laws passed by the state’s house of assembly remains valid as regards electricity generation, transmission, distribution, supply, and retail within that state. It allows for the establishment of power stations, electricity markets and collaboration between the State and Federal government to ensure electricity access to rural, unserved and underserved areas.
With the decentralization of electricity, states now have the flexibility to design solutions that suit the unique needs of their local communities. This allows states like Lagos, Nigeria’s business hub, to focus on addressing its specific energy challenges. While some states might prioritize renewable energy sources like solar or wind, others, such as Lagos, can focus on building the necessary infrastructure to boost electricity access, particularly in urban and underserved areas. As of 2020, only 31% of households in Lagos are connected to the national grid, leaving a staggering 69% dependent on costly and inefficient generating sets. These generators collectively have an estimated capacity of 15,000MW and impose an enormous financial strain on residents, costing them up to N5.2 trillion annually in fuel expenses alone[5].
Given Lagos’s rapid urban and industrial development with significant projects such as the Lekki Free Trade Zone, Dangote Refinery, and Eko Atlantic driving economic growth, the state must establish a distinct electricity market. This market would operate independently of the national grid but maintain a connection for efficiency. The focus would be on reducing emissions from backup generators and promoting a transition to cleaner natural gas fuel for electricity generation.
The state’s goal is to ensure a minimum of 50MW of reliable electricity, available for 20 hours daily, especially in underserved areas. By 2039, Lagos aims to eliminate the need for alternative generator capacity entirely, delivering consistent and affordable electricity to its residents and supporting the state’s growth into a 21st-century economy. This comprehensive approach will not only drive economic development but also enhance the quality of life for millions of Lagosian.
This vision will now be actualized through the decentralization of electricity, empowering Lagos to create a tailored energy market that meets its unique needs.
- CREATION OF STATE ELECTRICITY REGULATORY COMMISSIONS: for a while, there has been arguments regarding the powers of the state to regulate and make laws as regards the distribution, generation and transmission of electricity. With the emergence of the Electricity Act 2023 that has been put to bed as generation, transmission and distribution of electricity has been decentralized. A key feature of this decentralization is the creation of State Electricity Regulatory Commissions (SERCs), which are poised to play a crucial role in managing electricity generation, distribution, and consumption within individual states.
The State Electricity Regulatory Commissions (SERCs) have similar role as the Nigerian Electricity Regulatory Commission just that they are limited to their territories i.e. their state. This is one of the new innovations captured in the Electricity Act 2023. This move will allow each state to regulate tariffs, ensure good service and enforcement of its regulations in each state.
Section 63(7) of the Electricity Act 2023 supports the states’ right to create State Electricity Regulatory Commissions (SERCs), granting them the authority to license and regulate mini-grids, Independent Electricity Distribution Networks (IEDNs/IEDNOs), and Independent Electricity Transmission Networks (IETNs/IETNOs) within their jurisdiction. This empowers states to establish the necessary legal and institutional framework for regulating electricity utilities and promoting investments in their electricity sectors.
For now, only three states—Lagos, Edo, and Kaduna—have enacted electricity market laws and are ready to begin regulating their markets under this framework[6]. These states can exercise their rights to establish SERCs and manage their electricity generation, transmission, and distribution systems independently. However, the Nigerian Electricity Regulatory Commission (NERC) retains regulatory authority over these entities in states that:
(a) Do not have the legal or institutional framework to regulate mini-grids, IEDNs, or IETNs; or
(b) Rely on the national grid for the operation of such electricity undertakings.
In essence, this provision balances state autonomy in electricity regulation with federal oversight where needed to ensure cohesive national grid operations and electricity supply for states yet to establish their own regulatory mechanisms.
- Support for Off-Grid and Mini-Grid Systems: For more productivity and output of electricity, off-grid and mini-grid systems must play an important role. They create a decentralized electricity generation and distribution system. The Electricity Act 2023 focuses on enabling small-scale generation (below 1 megawatt), which doesn’t require a license but must comply with regulatory standards.
Off-grid systems typically generate electricity from renewable energy sources like solar, wind, and hydro, as well as small-scale conventional systems such as biomass or backup diesel generators. These systems are usually deployed in rural or remote communities where connecting to the national grid is either impractical or too expensive.
The Electricity Act 2023 provides states with the authority to regulate off-grid and mini-grid systems within their jurisdictions. This is particularly crucial for enhancing electricity access in regions where traditional grid extension is impractical or economically unfeasible. According to Section 63(7) of the Act, State Electricity Regulatory Commissions (SERCs) can issue licenses and provide a regulatory framework for mini-grids and Independent Electricity Distribution Networks (IEDNs). This move empowers states to support decentralized energy solutions that align with their local needs.
States like Lagos, Edo, and Kaduna have already enacted laws to regulate their electricity markets, thereby establishing a robust legal framework for mini-grids and off-grid solutions. These states can leverage the opportunities presented by mini-grid systems to provide electricity to underserved communities, promote rural electrification, and attract investment into their local power sectors. Off-grid systems, particularly those utilizing renewable energy, align with Nigeria’s national goals of reducing carbon emissions and transitioning to cleaner energy sources.
Mini grids are divided into two main categories which are isolated mini grid and interconnected mini grids. According to the Electricity Act 2023, isolated mini-grids can be further classified based on their capacity. For mini-grids with less than 100KW, operators have the option to either register or obtain a permit, though obtaining a permit is advisable as it entitles the operator to compensation if a distribution licensee extends its network into the operator’s area, protecting operators from potential losses due to national grid expansion. For mini-grids with capacities between 100KW and 1MW, a permit is mandatory. This permit formalizes the operator’s rights and ensures compensation in cases of encroachment by a distribution licensee. While awaiting permit approval, operators may function as registered mini-grid operators, but they are not entitled to compensation during this period.
Mini-grid and off-grid systems offer several benefits to Nigeria’s energy sector, particularly in addressing rural electrification challenges. These systems can be rapidly deployed to serve communities not connected to the national grid, especially in rural areas where extending the grid is cost-prohibitive. By decentralizing electricity generation and distribution, mini-grids provide immediate, reliable power and often utilize renewable energy sources, aligning with the country’s goals of increasing renewable energy adoption and reducing carbon emissions, as emphasized in Section 164(1)(H) of the Electricity Act 2023.
In addition to supporting national energy goals, mini-grids stimulate local economies by creating jobs and fostering entrepreneurship, while ensuring reliable electricity supply that enables business operations and drives economic growth in underserved areas. They also reduce pressure on the national grid by offering alternative electricity sources, improving the overall reliability of grid-connected areas. Through the regulatory framework provided by the Electricity Act 2023, states play a critical role in licensing and overseeing these systems, ensuring that mini-grids are effectively implemented to meet local electricity demands and foster sustainable development.
States now have the autonomy to regulate off-grid and mini-grid systems by issuing licenses to private investors who can operate mini-grids and power plants within their state. However, the Act precludes interstate and transnational electricity distribution. This ensures that the state governments can focus on localized electricity markets, enabling rural and underserved areas to benefit from tailored energy solutions that meet their specific needs.
- SETTING LOCAL ELECTRICITY TARIFFS: Under the Electricity Act 2023, Nigeria’s electricity sector is decentralized, giving state governments the authority to establish and regulate their electricity markets. A key aspect of this responsibility is setting local electricity tariffs, which is done through the creation of State Electricity Regulatory Commissions (SERCs). These commissions will operate similarly to the Nigerian Electricity Regulatory Commission (NERC), but with a focus on the specific needs of each state.
The Electricity Act allows states to set electricity tariffs that reflect the realities of their local economies. Tariffs are usually determined by factors like the cost of generation, transmission, distribution, maintenance, and the number of hours electricity is supplied. For instance, in areas where the cost of supplying power is higher, such as in remote locations using mini-grid systems, tariffs can be adjusted to reflect these costs.
States can also adjust tariffs based on local income levels and the standard of living. A state with a higher cost of living might set tariffs that balance affordability for residents while ensuring utilities remain profitable. In contrast, states with lower-income populations could implement subsidized tariffs or tiered pricing models that protect consumers from high electricity costs while still keeping the system financially viable. The Service-Based Tariff
(SBT) system, introduced by NERC in 2020[7], divides electricity consumers into service bands based on the average number of daily electricity hours received. Band A customers, for instance, get more than 20 hours of electricity and pay the highest tariff, while Band B (16-20 hours) and Band C (12-16 hours) pay lower tariffs[8]. States like Lagos and others have communities that fall into these service bands, ensuring that areas with more consistent supply pay more.
States have the power to regulate tariffs in a way that reflects the local cost of service delivery, helping utilities remain financially viable while keeping prices fair for consumers. This flexibility is crucial for encouraging investment, particularly in decentralized systems like off-grid and mini-grid solutions, which require substantial capital but need to remain affordable for end-users.
States can ensure that underserved areas, especially rural communities where extending the national grid may be too costly, are not neglected. They can set tariffs that support the sustainable operation of local electricity infrastructure while still maintaining affordability for consumers.
ENERGY THEFT OFFENCES
Electricity theft refers to the illegal tapping of electricity often without the knowledge or approval of electricity providers[9]. Theft of electricity as outlined in section 208 of the Electricity Act[10] can be defined as any act where a person illegally taps, connects, or interferes with the electrical system, including overhead, underground, or underwater lines, cables, service wires, or facilities of a licensed supplier. It also includes tampering with or bypassing meters, using tampered meters, devices, or methods that prevent accurate metering, damaging electrical equipment to interfere with proper registration, and using electricity unauthorized or for purposes other than the approved usage. These actions result in the illegal consumption or wastage of electricity, which is considered a criminal offense.
One of the several challenges faced by the power Distribution Companies (DisCos) is electricity theft. This has crippled the revenue and also increased the debt profile in the Nigerian Electricity Supply Industry (NESI) and has impacted our nations economy negatively. For instance, in 2014, the Ikeja Electricity Distribution Company (IKEDC) reported that 43,000 prepaid meters out of 134000 installed by the company have already been tampered with by their owners in a span of five years.[11] the Port Hacourt Electricity Distribution Company (PHED) in 2017 reported a loss of about 30% of expected revenue to energy theft which resulted in a huge revenue leakage to the company. [12] Another report also stated that approximately 40% of the country’s electricity is stolen or squandered. Illegal connections, meter manipulation, and infrastructure sabotage are standard, especially in densely populated cities and neglected rural areas.[13]
Furthermore, in a report by the Association of Nigerian Electricity Distributors (ANED) over N30,000,000,000.00 (Thirty Billion Naira) of their monthly revenue is lost to cases of electricity theft, meter bypass, vandalism and unpaid electricity bills by consumers. A Business Day investigation last year revealed that Nigeria’s electricity distribution companies lose over N174billion yearly to people who bypass meters and steal electricity and this is increasingly making it difficult for them to pay staff, run offices and repair or replace broken electricity infrastructure
One would wonder if there are legal frameworks and offences surrounding theft of electricity. As at now, the laws and regulation that frowns at the theft of electricity as formulated by the Nigerian Electricity Regulatory Commission are still in draft and have no effect. However, some other acts and laws provides for offences and punishment. Section 208 sub 1 (d) (i) of the Electricity Act 2023 divides theft of electricity into two (2) forms which are Consumption under 10 kilowatts and Consumption over 10 kilowatts and also provides different punishment for both theft of electricity.
For consumption under 10 kilowatts, if someone uses electricity for a purpose they were not authorized for, and the load is under10 kW, on the first conviction, they will pay a fine three times the financial gain from the theft. For a second or further offenses, the fine increases to six times the financial gain. For consumption over 10 kilowatts, If the unauthorized use exceeds 10 kW, on the first conviction, the fine is three times the financial gain. For subsequent convictions, they could face a fine of six times the gain or be sentenced to six months to three years imprisonment. The financial gain refers to the money saved or earned from using electricity without paying for it. For instance, if someone avoided paying ₦10,000 for electricity, the fine would be at least ₦30,000 for the first offense.
Section 209 outlines the offence and punishment of stealing electric lines and materials. It is to the effect that if a person cuts, removes, or transfers any electric lines, materials, or meters from a pole, tower, installation, or any rightful location without the owner’s or licensee’s consent, they are committing theft, regardless of whether it’s for profit. Similarly, storing or possessing electric lines, materials, or meters without consent, or transporting them from one place to another without permission, also constitutes theft, whether or not there is intent to gain. The penalty for a first offense is a fine of at least N500,000 or imprisonment for 3 to 5 years, or both. For a second or subsequent offense, the penalty increases to a fine of at least N1,000,000 or imprisonment for 5 years.
Section 211 is to the effect that any person who, without authorization, connects or disconnects a meter, indicator, or apparatus to an electric line supplied by a licensee, franchisee, or permit holder, or reconnects such equipment after it has been cut or disconnected, commits an offense. Additionally, laying or connecting electric works without permission to communicate with the works of a licensee is also an offense. Of particular concern is the tampering with meters, which is the most common form of electricity theft. This includes maliciously damaging meters, altering their readings, or preventing them from accurately registering electricity usage. These actions are punishable by a fine of up to N500,000 or imprisonment for up to 3 years, or both, with an additional fine of N10,000 for every day the offense continues.
The Lagos State Electric Power Sector Reforms Law 2018, also made provisions for curbing and reducing electricity theft within the state. The law criminalizes meter tampering and destruction of electricity transmission, receiving stolen electric lines, installations, equipment or infrastructure. The Law establishes a Power Task Force which is vested with the power to arrest offenders of the Law, enter, inspect and search premises in which an authorized officer of the Task Force has reason to believe that electricity is being or likely to be used unlawfully[14]. To validate the search by officers of the Task Force, the Law provides that the provisions of Part II of the Administration of Criminal Justice (Repeal and Re-enactment) Law, Ch A3, Laws of Lagos State shall apply with respect to searches and seizures under the law[15]. Furthermore, for speedy dispensation of cases, the Law vests jurisdiction to try offences in Special Courts (away from the slow system under the regular courts)
A BRIEF REVIEW OF EDO STATE ELECTRICITY THEFT LAW
Edo State has not enacted any law specifically for electricity regulation in the State beyond an enactment relating to electricity theft in the State. The Edo State Law on ‘Electricity Theft and Other Related Offences, and Establishment of the Special Offences (Electricity Theft) Court and for other purposes connected thereto’ is one of the extremely few electricity laws at the State levels for dealing with the issues of electricity theft. It provides for what constitutes evidence of illegal use of electricity to include a drilled hole in the glass cover of an electric meter, or at the back or any other part of the meter and the presence of a tampered, broken or fake seal on the meter, or mutilated, altered or tampered meter recording, amongst others are evidence of illegal use of electricity.
This Law seeks to deter illegal and unauthorised use of regulated electricity supply as well as to protect electricity infrastructure. Vandals or rather hooligans and those involved in all forms of electricity theft now risk two-year jail term with an option a TWO MILLIO NAIRA FINE. The law also mandates the establishment of electricity committees in all communities in the state to partner with the State Electricity Board in ensuring the prevention of trespass upon or damage to substations, buildings, cable, poles, transformers, electrical installation or premises appertaining to any supply undertaking or otherwise belonging thereto.
It then provides for the establishment of special offences (Electricity Theft) court for the purpose of trying various offences under the law. It further states that the special court shall sit at any convenient place close to the scene of the commission of any offences triable by the court under the law and committed in Edo State
STATE HIGH COURTS AND ELECTRICITY DISPUTES
An additional justification for the decentralized electricity or power sector governance in Nigeria is that by virtue of the provisions of the Nigerian Constitution, State High courts in Nigeria have the jurisdictional competence to hear and determine electricity-related disputes. Electric power is an item under the Second Schedule of the Constitution of the Federal Republic of Nigeria by virtue of paragraph 13 and 14 of the said schedules. Similarly, under section 251 of the CFRN 1999, High Court of the States and High Court of the Federal Capital Territory, as against the Federal High Court, would appear to have jurisdiction on issues bothering on power.
However, due largely to ignorance or lack of information on the procedural and substantive law on the subject, parties more often than not refer to Federal High Court. This necessarily means that the State High Court do have crucial roles to play in streamlining the legal and regulatory provisions of the power sector by breathing life, meaning as well as purpose into them without defeating or undermining the objective of power sector reforms, sector realities, profitability and SUSTAINABILITY.
In legal practice, it is observed that partially due to paucity of knowledge or lack of awareness as to the applicable law and/or practice of the power sector, practitioners often commit innocent professional blunders in filing suits bordering in electricity supply matters in the Federal High Court as against the State High Court. From the point of view of constitutional law, and bearing in mind that electricity is a concurrent legislative item for which National and States House of Assembly have the power to make laws, electricity is not one of the matters that the Federal High Court is vested with exclusive jurisdiction under the Nigerian Constitution. Therefore, a valid objection could be raised to the jurisdiction of the federal High Court in respect of electricity matters under the reliefs are carefully framed to confer jurisdiction on the Federal High Court.
The law has been settled unless in respect of causes and matters that are listed in section 251(1) of the Nigerian Constitution, the Federal High Court shall exercise no jurisdiction in respect of matter not so conferred by the Constitution. In the case of Jack v University of Agriculture Makurdi (2004) 5 NWLR (PT.865)208; the Supreme Court had considered the issue of whether the Federal High Court has jurisdiction in respect of matters (including human rights subjects) that arose otherwise than from the items in respect of which the Court is expressly vested with jurisdiction under section 251(1) of the Constitution. The apex court held that;
It has to however be noted that the exercise of this jurisdiction by the Federal High Court is where the fundamental right threatened or breached falls within the enumerated matters on which the court has jurisdiction. Thus, fundamental rights arising from matters outside its jurisdiction cannot be enforced by the High Court. See: Tukur v Government of Gongola State (1989) 3 NSCC 225
In view of the foregoing, by virtue of the provisions of section 251(1) of the Constitution of the Federal Republic of Nigeria, 1999(as amended), the Federal High Court has no power to either hear or determine matters or issues relating to the power sector unless the issue revolves around the exercise of statutory powers of agencies of the Federal Government like the Nigerian Electricity Regulatory Commission(NERC), or Nigerian Electricity Management Services Agency(NEMSA) amongst many others.
It needs to be acknowledged that the position of the law on this issue of jurisdiction vis-a-vis Federal agencies and institutions appears unsettled. In the case of N.E.P.A versus Edegbero, the court in deciding the proper approached to the interpretation of section 230(1) 1979 Constitution now Section 251(1) of the Constitution of the Federal Republic of Nigeria, said;
In construing section 230(1), of the 1979 constitution as amended, two important matters rise. They are the parties in the litigation as well as the subject matter of the litigation. The court must consider both. In construing parties, the court will have no difficulty in identifying the Federal Government but it may have some difficulty in identifying an agency of the Federal Government in certain matters. The case law and the law of the agency will certainly be of great help in relevant cases.
The above statement shows that a lot more effort is requires streamlining and putting in clearer practice perspectives the position of the law on the issue of jurisdiction in respect of power sector dealings as well as transactions. This is actually very particular where it involves Federal Government statutory agencies or entities as distinct from those involving electricity companies and customers on bordering on core contractual relationships. However, the generally acceptable view remains unchanged to the effect that by virtue of section 251(1) of the Constitution of the Federal Republic of Nigeria, 1999 as amended, the Federal High Court HAS NO POWER TO HEAR OR DETERMINE matters relating to electric power unless those within the expectations as explained or illustrated above in respect of statutory agencies or bodies of the Federal Government.
CONCLUSION
This article reviews constitutional provisions as they affect powers of Federal and State Governments in the electric power sector with a view to determining the extent of the Federal government’s powers to legislate on and regulate the power sector in Nigeria, compared to the powers of component units to do the same. It also reviewed the methods that could be adopted by the state government to regulate electricity. Without the proper management of electricity by each state, the Federal government would continue impoverishing the citizenry as it infringes on the powers of the state to regulate electricity. The legal framework to enable the federating units and their components to regulate the sector in the most effective way must be strictly adhered by the concerned components in order that the citizens will be able to maximize its benefits.
REFERENCES
Books
Yemi Oke (2021) Nigerian Electricity Law and Practice, Princeton and Associates Publishing Co. Ltd.
Laws
Chapter A3, Laws of Lagos State 2015
The Constitution of the Federal Republic of Nigeria 1999(as amended)
Items 13 and 14, of the Schedule II to the Constitution of the Federal Republic of Nigeria, 1999 as amended
Lagos State Electric Power Sector Reform Law, 2018
N.E.P.A v Edegbero (2002) 18 NWLR (Pt.798)79
Nigerian Electricity Management Services Agency, Act 2015(NEMSA)
Section 1 of the Nigerian Electricity Regulatory Commission’s Electricity Theft and other Related Offences Regulations, 2014
Section 47 of the Lagos State Electric Power Sector Reforms Law 2018
Section 63 sub 2b of the Electricity Act, 2023
Section 251(1) Constitution of the Federal Republic of Nigeria on exclusive of the Federal High Court
Electronic Publications
aluko—oyebode.com/legal/insights
Electricity Act 2023: An overview – LawPavilion Blog
Energy theft: PHED moves against perpetrators – Vanguard News (vanguardngr.com)
The Edo State Law on “Electricity Theft and Other Related Offences, and Establishment of the Special Offences (Electricity Theft) Court and for Other Purposes Connected Thereto, on-line at: https://www.pressreader.com/Nigeria/thisday/
Waado.org/nigerdelta/ConstitutionalMatters/1999Constitution/SecondSchedule.html
Vanguard Newspaper, <https://www.vanguardngr.com/2019/06/electricity-theft-regulation-and-timely-law-to-salvage-energy-loss/
[1]Electricity Power Sector Reform Act of 2005 which was repealed by the Electricity Act 2023
[2] Section 63 sub 2b
[3]11 electricity distribution companies in Nigeria and their service states – Businessday NG
[4]Nothing in this Act shall invalidate – [Second schedule]
(a) any law passed by the House of Assembly of a State with respect to all aspects of generation, transmission, system operation, distribution, supply and retail of electricity within that State
[5]Lagos, electricity policy and sustainable power supply – Vanguard News (vanguardngr.com)
[6]Electricity Act 2023: An overview – LawPavilion Blog
[7]https://www.energymrc.ng/what-is-the-service-based-tariff-sbt-regime/#:~:text=Simply%20put%2C%20the%20SBT%20is,getting%20more%20consistent%20electricity%20supply.
[8]Electricity Tariff Hike: Full list of Lagos Communities Under Band A, B, C, D and E – Legit.ng
[9]4 Dangers of Electrical Theft, Illegal Connections And Its Consequences in Nigeria (buypower.ng)
[10] See also Section 1 of the Nigerian Electricity Regulatory Commission’s Electricity Theft and other Related Offences Regulations, 2014
[11]he Ikeja Electricity Distribution Company (IKEDC) June 10th 2014 “43,000 Installed Prepaid Meters Already
[12]Energy theft: PHED moves against perpetrators – Vanguard News (vanguardngr.com)
[13]Protecting Nigeria’s Economy From Electricity Theft (leadership.ng)
[14]Section 47 of the Lagos State Electric Power Sector Reforms Law 2018
[15]Chapter A3, Laws of Lagos State 2015
