Lagos State has launched a major initiative to reshape its electricity sector through the Lagos Integrated Electricity Policy and Strategic Implementation Plan.

This policy aims to create a more efficient, sustainable, and reliable energy system and steer the future of the Lagos Electricity Market.

A Roadmap for the Lagos Electricity Market

Within six months of this law’s commencement, the Lagos Ministry of Energy, the State Electricity Commission, and other stakeholders will release the first edition of the Lagos Integrated Electricity Policy and Strategic Implementation Plan. The policy will focus on critical aspects of the electricity sector, including:

• Market Structure: The plan will define the Lagos Electricity Market’s operation and function.
• Resource Utilisation: It will ensure optimal use of power generation resources like fossil fuels, renewable energy, and nuclear substances while emphasising Lagos’ local resources.
• Supply and Demand Management: The plan will evaluate supply and demand-side resources, assess deployment constraints, and account for financial and environmental impacts.
• Public-Private Partnerships: It will establish partnerships that secure reliable and affordable electricity supplies.
• Decarbonisation: The policy will drive a transition toward renewable energy, promoting clean, sustainable electricity generation.
• Energy Efficiency: The plan will encourage energy-saving technologies and practices to lower consumption.
• Innovation: It will foster the adoption of new technologies to improve electricity generation and distribution.
• Infrastructure Development: The policy will ensure infrastructure for generation, transmission, and distribution expands to meet rising demand and reduce energy losses.

Policy Approval and Execution

The State Executive Council will approve the Lagos Integrated Electricity Policy and Strategic Implementation Plan before implementation. After approval, the Ministry of Energy will administer, monitor, and review the plan regularly. The Ministry will also produce annual reports outlining progress and suggest adjustments where necessary.

In addition to shaping electricity policies in Lagos, the Ministry will advise the government on interstate electricity trading and ways to maintain energy security and sufficiency.

Licensing and Regulation

All electricity activities, including generation, transmission, distribution, and system operation, will require a license from the Lagos Electricity Commission. Businesses operating in the Lagos electricity sector must apply for the relevant license within three months. In collaboration with the Lagos Independent System Operator (ISO), the Commission will invite qualified companies to participate in the electricity services market.

Certain exceptions exist for entities with small-scale operations, specifically those with a capacity under 500kW, which do not need licenses.

Long-Term Vision and Updates

The policy will provide a long-term vision, with each edition covering at least 10 years. A full review will occur every five years to ensure the policy adapts to Lagos’ evolving needs. The Ministry can make interim revisions, with input from the Commission and the Lagos ISO.

The Ministry, the Commission, and the Lagos ISO will publish the policy and its updates on their websites to keep stakeholders and the public informed.

Electricity Procurement and Ancillary Services

The policy will regulate all contracts for new electricity sources, procurement, and related services. These guidelines will also govern the development of new power supply sources to meet Lagos’ growing energy needs.

Licensing for Electricity Services

Under the new law, no one can provide electricity services, whether generation, transmission, distribution, trading, or system operation, without a license from the Commission. This rule applies to new market entrants and existing operators.

Businesses unsure of their licensing requirements must seek clarification from the Commission. Exceptions apply to small-scale operators with capacities below 500kW, who are not required to obtain licenses.

The Commission and the Lagos ISO will invite credible companies to apply for service provision within the Lagos Electricity Market through a competitive process, promoting fair and transparent operations.

Policy Oversight and Review

The Ministry of Energy will oversee the policy’s administration, management, and revision and advise the government on forming electricity market policies and interstate electricity trading.

Each year, the Ministry will submit a report to the Lagos government detailing progress, success areas, and recommended adjustments to meet future electricity demand.

Ensuring Long-Term Energy Sustainability

Each edition of the Lagos Integrated Electricity Policy will cover at least 10 years, with a comprehensive review every five years. This ensures the policy stays relevant to emerging trends and market conditions. The Ministry will revise the policy as necessary in consultation with the Lagos ISO and the Electricity Commission.

Transparent Publication of Policy Revisions

The Ministry, the Commission, and the Lagos ISO will publish the first edition and any policy revisions on their websites. This approach ensures stakeholders stay informed about the state’s electricity strategies and future direction.

The Lagos Integrated Electricity Policy and Strategic Implementation Plan aim to create a sustainable, secure, and efficient electricity market in Lagos State. The policy prioritises renewable energy, public-private partnerships, innovation, and infrastructure development, positioning Lagos for a future-proof energy system.

With strong regulatory oversight, periodic reviews, and transparency, Lagos is leading the charge in energy security and efficiency, cementing its role as a leader in Nigeria’s electricity sector.