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Nigeria boosts power infrastructure with 13 new licenses for off-grid generation and electricity trading

The Federal Government, via the Nigerian Electricity Regulatory Commission, issues licenses in a bid to enhance electricity access and bolster the nation's power supply infrastructure

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In a significant move towards expanding Nigeria’s power infrastructure, the Federal Government, through the Nigerian Electricity Regulatory Commission (NERC), has granted 13 new licenses for off-grid and embedded power generation, independent electricity distribution, and electricity trading. The licenses, totaling 40.9 megawatts, were issued during the third quarter of 2023.

The latest report from NERC, under the section titled ‘Licences and Permits Issued or Renewed,’ revealed the breakdown of the licenses. Five new off-grid generation licenses, generating 8.81 MW, and one embedded generation license for 5 MW were issued during the review period. Additionally, one license each for Independent Electricity Distribution Network (IEDN) and trading, three off-grid generation licenses, one embedded generation, and one IEDN license were granted.

NERC clarified that it issues licenses covering various aspects of the electricity supply industry, including generation, transmission, distribution, trading, and system operations. For activities that necessitate authorization but don’t require licenses based on the Electricity Act 2023, such as off-grid captive power generation and mini-grid development, the commission issues permits following a review of relevant applications.

Nigeria, with a population exceeding 200 million, faces challenges in power generation, producing between 3,500 MW and 5,000 MW. Rural communities often experience blackouts due to the insufficient power supply. The country aims to address this issue by continuously working to increase its electricity output.

The 13 new licenses include various projects across Nigeria. Daybreak Power Solutions Limited received eight licenses for off-grid power generation projects in Lagos, Abia, Borno, Kano, Oyo, and Abuja. Ekiti Independent Power Project secured a license for a gas-fired 5MW embedded power project in Ekiti State. Olokiti Power Distribution Limited obtained an IEDN license to operate in Ekiti State. Ember Power Limited received an electricity trading license, while Island Power Limited was granted a license for a 10 MW embedded gas-fired power project in Lagos. Energy Company of Nigeria Limited obtained an IEDN license to operate in Lagos State.

Despite substantial investments in the power sector, power consumer groups have consistently criticized the inadequate electricity supply in Nigeria. The issuance of new licenses signals the government’s commitment to enhancing electricity access and addressing the nation’s power challenges.

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