Following the liberalisation of power generation and supply, the Nigerian Electricity Regulatory Commission (NERC) has rolled out guidelines for the sector.
NERC released out two sets of regulations: Independent Electricity Distribution Networks (IEDN) and Embedded Generation.
According to the commission, the regulations provide for independent power distribution by individuals or groups that are not traditional distribution companies (DISCOs).
Embedded generation is when a power plant is built in an area and not connected to the national grid. The generated capacity is connected to the network.
The Federal Government had retained the exclusive right of electricity power generation and distribution for commercial purposes.
However, NERC licensed some large firms to produce some units for industrial use.
Speaking at the presentation of the two documents in Abuja yesterday, the Chairman of the commission, Dr Sam Amadi, said the firms hold the “potential to revolutionise electricity supply in Nigeria”in the short term.
Section 96 of the 2005 Power Reform Act allows the commission the power to make regulations for independent electricity distribution and embedded generation.
His words: “This is very important apart from the issue of reliability. In some case where we have long distances and difficult terrain, areas far away from transmission network that even when there is supply, there is so much losses.”
Guidelines for independent power out