Concerns expressed by 16 State Electricity Regulatory Commissions (SERCs) about a bill pending in the Senate, seeking to amend the Electricity Act 2023, deserve closer scrutiny. The federal lawmakers should be careful not to reverse the potential gain of the law prematurely, as the bill appears to suggest. Nigeria’s electricity sector stands at yet another dangerous crossroads.

Barely three years after the historic constitutional amendment and the enactment of the Electricity Act 2023 opened the door to genuine decentralisation of electricity generation, transmission and distribution, a proposed Electricity Act 2023 (Amendment) Bill, 2026 now threatens to reverse one of the most significant reforms in the nation’s power sector.

If allowed to proceed in its present form, the amendment would not merely alter legislation; it would undermine the very philosophy of federalism upon which the reform was founded.

The strong opposition mounted by the 16 SERCs should therefore not be dismissed as mere bureaucratic resistance. Their memorandum to the Senate Committee on Power deserves careful attention because it raises a profound constitutional and economic question on whether the Federal Government is suddenly changing its mind over electricity liberalisation.

The states argue that the amendment seeks to recentralise regulatory powers that were deliberately devolved through the constitutional amendment and the Electricity Act 2023.

In a comprehensive, strongly worded memorandum submitted to the Senate Committee on Power, the 16 states warned that the proposed Electricity Act (Amendment) Bill 2026 could reverse one of the most significant reforms in Nigeria’s power sector. The regulators argued that the amendment bill, rather than strengthening the electricity market, seeks to restore extensive federal oversight over matters they insist have constitutionally become the responsibility of states.

Signatories to the document included the chairmen and chief executives of electricity regulators in Abia, Anambra, Bayelsa, Edo, Ekiti, Enugu, Gombe, Imo, Kogi, Lagos, Nasarawa, Niger, Ogun, Ondo, Oyo and Plateau states. The regulators said they had taken advantage of the Electricity Act 2023 to begin building sub-national electricity markets and had already engaged investors based on the framework created by the law.

They said they had identified 17 contentious provisions in the proposed amendments to the Electricity Act that they believed could undermine the constitutional powers already granted to states in the electricity sector. According to the regulators, the areas of disagreement include the authorisation of State Houses of Assembly to legislate on electricity matters, the supremacy of state laws within state electricity markets, and provisions seeking to retain federal control over all activities connected to the national grid.

The regulators also raised concerns over the proposed expansion of the powers of the Nigerian Electricity Management Services Agency, the structure and decisions of the Forum of Electricity Regulators, and the provision granting the Nigerian Electricity Regulatory Commission final administrative appellate jurisdiction on certain issues arising within the forum.

They argued that the disputed provisions require further consultation to ensure that the decentralisation objectives of the Electricity Act are not weakened by subsequent amendments.

If anything, the regulators’ fears would amount to the government taking with one hand what was deliberately given with the other. It would also represent a serious policy inconsistency capable of frightening investors who have begun committing resources to emerging state electricity markets.

Electricity perhaps provides the clearest illustration of why excessive centralisation has failed Nigeria. For decades, virtually every aspect of power generation and transmission has revolved around Abuja. Yet, despite enormous public expenditure, repeated privatisation exercises, numerous reform committees and countless policy pronouncements, Nigeria remains one of the countries with the poorest electricity supply in the world.

The evidence is overwhelming. The national grid continues to collapse with embarrassing regularity, plunging millions of homes and businesses into darkness. Industries spend billions annually on diesel-powered generators. Hospitals struggle to perform life-saving operations. Universities conduct research under an unstable electricity supply. Small businesses are crippled by soaring energy costs, while investors increasingly cite unreliable electricity as one of the greatest obstacles to doing business in Nigeria.

No nation aspiring to become a modern industrial economy can continue to function under such conditions. The truth is that Nigeria’s electricity crisis is no longer merely an infrastructure deficit. It has become a national economic emergency. It depresses productivity, fuels inflation, destroys jobs, discourages foreign investment and condemns millions of citizens to avoidable poverty.

The greatest structural weakness lies in the continued dependence on a single national grid attempting to serve more than 200 million people across the 36 states and the Federal Capital Territory. Such a highly centralised arrangement has proved both fragile and inefficient. Every grid collapse merely confirms what Nigerians have known for years: the present system has reached its practical limits.

This is precisely why electricity decentralisation should be accelerated, not reversed. Federalism was never designed to concentrate every important economic activity at the centre. The principle of subsidiarity dictates that responsibilities should reside at the lowest level of government capable of discharging them efficiently. Electricity fits that principle perfectly.

States possess different economic capacities, energy resources and developmental priorities. Lagos has different electricity demands from Gombe. Rivers faces different industrial realities from Ekiti. Abia’s emerging electricity market cannot be regulated in the same way as Plateau’s. Allowing states greater operational autonomy does not weaken the federation; it strengthens it.

In any event, several states have already demonstrated encouraging progress. Lagos has unveiled ambitious plans for an independent electricity market. Abia, for instance, has commenced significant reforms aimed at developing its own power ecosystem. Other states are preparing similar initiatives under the authority granted by the Electricity Act 2023.

These efforts deserve encouragement, not regulatory uncertainty. Around the world, successful federal systems embrace decentralised electricity governance. In the United States, states exercise substantial authority over electricity regulation alongside federal oversight. In the United Kingdom, regional and local energy initiatives increasingly complement national energy policy. Competitive electricity markets, regional grids and multiple generating entities have become standard features of modern power systems.

Nigeria should be learning from these successful models instead of retreating into outdated centralisation.

Equally disturbing is the Federal Government’s continued tendency to monopolise activities that states and the private sector are better placed to undertake. For instance, procurement of prepaid meters remains excessively centralised. There is little reason why states should not be empowered to attract meter manufacturers, encourage local assembly and accelerate metering within their jurisdictions.

Likewise, rural electrification should become primarily state-driven. Rural communities differ enormously across the federation. State governments understand their terrain far better than distant federal bureaucracies. They are therefore better positioned to deploy mini-grids, solar systems and other decentralised energy solutions tailored to local circumstances.

On the contrary, Abuja should concentrate on functions that genuinely require national coordination. First, domestic gas supply must become an urgent national priority. It remains inexplicable that one of the world’s largest gas producers continues to suffer chronic gas shortages for thermal power generation. Government should not prioritise export earnings while domestic industries remain crippled by inadequate electricity. Gas infrastructure should be expanded, pipelines protected and domestic supply obligations strictly enforced.

Second, transmission infrastructure requires massive modernisation. Even where electricity generation improves, the existing transmission network often lacks the capacity to wheel available power efficiently. Decades of underinvestment have left the transmission system outdated, vulnerable and grossly inadequate for a twenty-first-century economy.

What Nigeria needs today is not another reversal of power liberalisation reform but the courage to deepen it. The National Assembly should therefore proceed with the utmost caution. Any amendment capable of weakening state electricity markets, discouraging investment or restoring excessive federal control should be rejected. Investors require certainty. States require regulatory stability. Citizens require electricity—not another cycle of policy reversals.

Power, after all, is not merely about electricity. It is also about governance. And in both respects, excessive centralisation has failed Nigeria for far too long.