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Nigeria issues 13 new licenses to boost off-grid power generation, distribution

The Nigerian Electricity Regulatory Commission (NERC), acting on behalf of the Federal Government, has issued 13 new licences in the third quarter of 2023 for various aspects of the power sector, including off-grid and embedded power generation, independent electricity distribution, and electricity trading. The cumulative electricity generation capacity of the newly licensed projects is estimated to be 40.9 megawatts.

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According to the third-quarter 2023 report from NERC, five new licences for off-grid generation were issued, contributing 8.81MW to the total capacity. Additionally, one new licence for embedded generation with a capacity of 5MW was granted. The report also highlighted other licences issued during the period, including one for the Independent Electricity Distribution Network (IEDN), one for trading, three for off-grid generation, one for embedded generation, and one for IEDN.

NERC clarified that licences are issued for various activities within the Nigeria Electricity Supply Industry, covering generation, transmission, distribution, trading, and system operations. Furthermore, for activities not requiring licences but necessitating authorization from the commission, such as off-grid captive power generation and mini-grid development, permits are issued following a thorough review of the relevant applications.

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Nigeria has been grappling with inadequate power supply, with electricity generation ranging between 3,500MW and 5,000MW for a population exceeding 200 million. Many regions, particularly rural areas, experience frequent blackouts due to the country’s limited power generation capacity.

The issuance of these licences is part of ongoing efforts by the Federal Government and power sector operators to enhance electricity output and address the challenge of electricity access. The move is expected to contribute to the reduction of the significant number of Nigerians currently without access to electricity.

The NERC report outlined specific licence allocations, including eight licences for various off-grid power generation projects to Daybreak Power Solutions Limited in Lagos, Abia, Borno, Kano, Oyo, and Abuja. The Ekiti Independent Power Project received a licence for a 5MW embedded gas-fired power project in Ekiti State, while Olokiti Power Distribution Limited secured an IEDN licence operational in Ekiti State. Ember Power Limited obtained an electricity trading licence, and Island Power Limited was granted a licence for a 10MW embedded gas-fired power project in Lagos. Energy Company of Nigeria Limited also received an IEDN licence operational in Lagos State.

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