The Federal Government has revealed that local governments may soon become active players in Nigeria’s electricity market as ongoing reforms continue to decentralise the power sector.
Minister of Power, Adebayo Adelabu, made this known on Wednesday in Abuja during the inauguration of the board of the Nigeria Electricity Management Services Agency. He explained that the evolving electricity framework is opening up opportunities for participation at the grassroots level.
According to him, local governments are expected to key into the sector as decentralization gains momentum, particularly in areas such as rural electrification, mini-grid development, and last-mile power distribution.
Adelabu noted that the move aligns with the broader reform agenda of President Bola Tinubu’s administration, aimed at expanding electricity access and strengthening governance across all levels of the power value chain.
The development follows the implementation of the Electricity Act 2023, which empowers states to generate, transmit, and distribute electricity within their jurisdictions. So far, several states have begun establishing regulatory frameworks and sub national electricity markets to attract investment and improve power supply.
The minister explained that increased participation at the local level would help bridge Nigeria’s long-standing electricity gap, ease pressure on the national grid, and promote a more reliable and inclusive power system.
As part of efforts to strengthen the sector, Adelabu also announced plans to procure no fewer than 10 million electricity meters over the next five years to address the country’s metering deficit, currently estimated at over seven million.
He stressed the importance of local production, urging a shift away from heavy dependence on imports.
“Must we import all these and use our wealth to create prosperity for other countries? We must begin to manufacture our meters locally, create jobs, and grow our economy,” he said.
The minister lamented that about 90 per cent of power equipment used in Nigeria is imported, a situation he said increases costs and puts pressure on foreign exchange.
He added that the government is working towards boosting local capacity in the production of meters, batteries, and other power components, while also tapping into renewable energy opportunities. According to him, Nigeria’s lithium reserves could support the local manufacturing of batteries and other clean energy technologies.
Adelabu also highlighted that some solar panels are already being produced locally and exported to neighbouring countries, expressing optimism that similar progress could be achieved in other areas of the power sector.
During the event, he formally inaugurated the new NEMSA board, describing its role as critical to ensuring safety standards, quality control, and technical compliance across the electricity industry.
He charged the board to enforce strict standards and tackle the circulation of substandard electrical materials, warning that poor enforcement has contributed to system failures, losses, and safety risks.
“A zero-tolerance approach to substandard infrastructure is non-negotiable if we are to build a reliable electricity market,” he said.
Adelabu further noted that Nigeria’s power sector has undergone significant structural changes, with over 70 per cent of generation companies now privately owned, while all distribution companies are largely controlled by private investors.
He added that the government is gradually transitioning to cost-reflective tariffs to ensure the financial sustainability of the sector, while also addressing the challenge of ageing infrastructure—much of which is over six decades old.
In her remarks, the chairperson of the NEMSA board pledged collaboration with stakeholders to effectively carry out the agency’s mandate, acknowledging the evolving nature of the electricity sector and the need for adaptability.
The latest development underscores the Federal Government’s push to deepen reforms in the power sector, expand participation, and improve electricity access across the country.
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