Efforts by state governments to influence electricity tariffs have sparked a major standoff with power distribution companies (Discos), following a recent tariff cut by the Enugu Electricity Regulatory Commission (EERC).
Commissioners of Power from all 36 states announced their readiness to negotiate cost-reflective but fair electricity prices in response to growing public concern over high energy costs.
This comes after the EERC reduced tariffs for Band A customers in Enugu from N209/kWh to N160/kWh, drawing resistance from both generation and distribution companies who claim such measures threaten the viability of the national power sector. Discos have rejected the idea of negotiating with state authorities, warning that such interventions could disrupt recent gains in power supply.
The Nigerian Electricity Regulatory Commission (NERC) recently confirmed that seven states—Enugu, Ondo, Ekiti, Imo, Oyo, Edo, and Kogi—now control their electricity markets under the Electricity Act 2023. Others like Lagos, Ogun, Niger, and Plateau are expected to follow by September, as decentralisation in the power sector deepens.
Chairman of the Forum of State Commissioners of Power and Energy, Prince Eka Williams, said states were empowered by law to regulate electricity in their territories. “Each state regulator is uniquely positioned to determine fair tariffs and stimulate investment based on their market dynamics and consumer needs,” he stated.
Responding to concerns about whether states could bear the cost of subsidies, Williams noted that there’s no blanket approach. “What’s important is dialogue. Each state operates differently, and any governor may decide to shoulder this responsibility if needed,” he added.
The forum also defended Enugu’s decision, clarifying that the tariff reduction did not affect the wholesale market where power generators operate. According to the forum, the cut was based on a detailed review of MainPower’s capital and operational costs and was in line with the Electricity Act.
Discos, however, argue the states are undermining the national market. Sunday Oduntan, CEO of the Association of Nigerian Electricity Distributors, warned, “We are not negotiating with the states. What they are doing will destroy the market. If the tariff cut continues, power supply will drop again.”
EERC clarified that its order only applies within Enugu State and fully accommodates national grid delivery costs. The commission also assured that MainPower will still recover all efficient costs, and that no part of the generation or transmission cost has been tampered with.
While states like Ekiti and Ondo maintained the existing MYTO tariffs, others, including Lagos and Plateau, have hinted at upcoming adjustments. Lagos Commissioner Biodun Ogunleye expressed frustration, saying local Discos were resisting state-level reforms and backing a controversial bill in the Senate to limit state powers.
Despite resistance, the EERC invited interested generation companies to set up plants in Enugu under a willing-buyer, willing-seller framework, asserting it would support investment through transparent, cost-reflective agreements. The commission concluded by affirming its commitment to consumer fairness and sustainable power delivery at the sub-national level.
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