The Nigerian Electricity Regulatory Commission (NERC) has issued permits to several companies, including MTN Communications Nigeria Limited and Golden Penny Power Limited, allowing them to generate electricity through mini-grid systems. This move is part of a broader effort to enhance electricity supply in Nigeria, particularly in areas where traditional power sources are unreliable.
In the first quarter of 2024, NERC granted nine new off-grid generation licenses with a total capacity of 109.69 megawatts. Among these, Golden Penny Power Limited received a license to construct six off-grid gas plants located in Lagos, Oyo, Ogun, and Cross River states, contributing a significant 100 megawatts to the grid. Meanwhile, MTN was authorized to build four captive generation plants in Lagos State, which will have a combined capacity of 15.94 megawatts.
Captive power generation permits allow companies to generate electricity for their own use rather than for sale to third parties. In total, NERC issued nine captive power generation permits in the first quarter of 2024, amounting to a total capacity of 52.57 megawatts. Other companies that received permits include SweetCo Foods Limited, African Steel Mills Nigeria Limited, West African Ceramics Limited, Royal Engineered Stones Limited, and Armilo Plastics Limited.
NERC’s regulations, established under Section 165(1)(m) of the Electricity Act 2023, enable the commission to award mini-grid concessions to renewable energy companies. These companies are tasked with serving specific geographical areas, ensuring that they generate and distribute electricity to meet local demand.
In addition to the off-grid licenses, NERC has continued to promote the development of renewable energy by issuing permits and registration certificates for mini-grid projects. A mini-grid developer can receive a permit for constructing, operating, and maintaining mini-grids with a distribution capacity above 100 kilowatts and a generation capacity of up to 1 megawatt. For systems with a distribution capacity below 100 kilowatts, registration certificates are issued.
During the first quarter of 2024, NERC also certified six Meter Service Providers, which include manufacturers and installers of electric energy meters. These providers play a crucial role in ensuring accurate metering and billing for electricity consumption.
The commission has been proactive in issuing regulations and orders to guide the activities of licensed electricity providers. In the same quarter, NERC issued one regulation and 36 new orders, including those related to customer eligibility and tariff structures for distribution companies.
This initiative by NERC to grant electricity generation permits is expected to improve power supply in Nigeria, particularly in underserved areas. By encouraging private sector participation in electricity generation, the commission aims to enhance the reliability and availability of power, ultimately benefiting consumers and businesses alike.
As Nigeria continues to face challenges in its electricity sector, these developments signal a positive step towards diversifying energy sources and increasing access to reliable electricity for all citizens.
