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Nigeria’s World Bank debt to hit $9.65bn

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World Bank loans to Nigeria between 2023 and 2025 are projected to reach $9.65bn by the end of this year as fresh approvals, ongoing negotiations, and disbursements gather pace across key sectors.

The amount covers International Bank for Reconstruction and Development and International Development Association loans only, according to an analysis of data on the bank’s website by The PUNCH. When grants are added, total World Bank support rises to about $9.77bn within the three-year window.

The International Bank for Reconstruction and Development provides loans on commercial or near-commercial terms to middle-income and creditworthy low-income countries, while the International Development Association offers highly concessional loans and grants to the world’s poorest nations.

The figures show a steady build-up of commitments with government officials pushing ahead with digital infrastructure, social protection, power, education, and health programmes while defending the concessional nature of the borrowings.

The Federal Government is expected to secure another $500m facility on December 19, 2025, under the Fostering Inclusive Finance for MSMEs in Nigeria project. The operation is being prepared for Board consideration and will be implemented through the Development Bank of Nigeria.

The borrowing cycle under the administration of Bola Tinubu began with $2.7bn in loans in 2023 across four major projects. Financing that year was dominated by power sector recovery, renewable energy access, girls’ education, and women’s economic empowerment.

The Nigeria Distributed Access through Renewable Energy Scale-up project received $750m in IDA financing to expand private sector-led clean energy access. Another $700m IDA credit was approved for girls’ secondary education in participating states. Women’s economic empowerment attracted $500m IDA through the Nigeria for Women Programme Scale Up.

The AF Power Sector Recovery operation received $449m in IBRD financing and $301m in IDA to improve the reliability of the electricity supply and restore financial sustainability in the sector. There were no grant components in 2023, so the entire amount consisted of loans.

The volume of loans rose sharply in 2024 as new approvals reached $4.25bn, representing a 57.4 per cent increase compared with the preceding year. The increase was driven largely by two policy-based operations and three separate $500m IDA investment packages.

The Nigeria Reforms for Economic Stabilisation to Enable Transformation programme provided $1.5bn in loans, split between $750m IBRD and $750m IDA, as the government sought fiscal space and protection for vulnerable populations while reforms continued.

Another $750m IBRD loan was approved for the NG Accelerating Resource Mobilisation Reforms programme to boost non-oil revenues and safeguard oil and gas receipts.

The World Bank also cleared $500m IDA each for rural road access, primary healthcare strengthening, and dam safety and irrigation programmes. The primary healthcare programme included a $70m grant, which lifted total World Bank support for 2024, including grants, to about $4.32bn.

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For 2025, the data shows $2.695bn in loans at various stages of project processing alongside $52.18m in grants. Nine operations have already been identified across financial inclusion, digital broadband, health, education, social protection, and institutional capacity.

The largest facilities are tied to $500m IDA each for broadband expansion, basic education, and livelihood support for poor and vulnerable households. Health security, nutrition, and internally displaced communities account for another $630m, while procurement standards receive $65m from IDA.

A $400m IBRD component is included for the MSME finance programme, along with a $100m IDA portion. Also, the Central Bank of Nigeria is to receive a $6.8m grant to strengthen technology-enabled oversight of the banking sector and deepen understanding of payment and remittance systems.

Compared with 2024, the 2025 loan pipeline represents a decline of about 36.6 per cent, though it is broadly in line with the $2.7bn reached in 2023. Across the three years, IDA loans account for about $7.30bn while IBRD loans contribute roughly $2.35bn. Grants add another $122.19m, rising from zero in 2023 to $70.01m in 2024 before easing to $52.18m in 2025.

The portfolio highlights the scale of financing underpinning Nigeria’s reform programme as authorities continue to seek low-cost multilateral resources even as concerns persist over debt sustainability and the need to strengthen domestic revenue mobilisation.

The PUNCH earlier reported that Nigeria’s stock of World Bank International Development Association loans rose to $18.5bn, making it the largest IDA borrower in Africa and the third-biggest in the world.

Fresh data from the IDA’s unaudited financial statements for the third quarter of 2025 confirmed that the country has maintained the ranking it first attained in 2024, when it climbed to third place after overtaking India. The country was the fourth-largest borrower in 2023.

According to the report, Nigeria’s exposure increased from $17.1bn in September 2024 to $18.5bn in September 2025, representing a rise of $1.4bn or 8.2 per cent. The increase reflects the country’s heavier reliance on concessional financing to plug infrastructure gaps, stabilise its reform programme, and support social spending amid volatile oil earnings.

Economists warn that the rising loan pipeline, while potentially beneficial for long-term development, could deepen fiscal pressures if not matched with stronger domestic revenue mobilisation and prudent expenditure management.

Lagos-based economist, Adewale Abimbola, reacting to the rising World Bank commitments to Nigeria, said loans from multilateral institutions such as the World Bank are largely concessionary, with interest rates typically below market levels and longer repayment tenors.

He noted that the critical question is not whether Nigeria should be borrowing, but whether the loans are structured and deployed effectively. “If it’s concessionary and tied to viable projects with medium-term revenue prospects, I don’t think it’s a bad idea,” Abimbola explained. “Borrowing isn’t bad; what matters is utilisation.”

He stressed that the economic impact of such loans depends on how well they are channelled into projects that can generate sustainable growth, strengthen revenue, and improve public services over time.

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Development economist and CEO of CSA Advisory, Dr Aliyu Ilias, has expressed strong reservations about Nigeria’s rising debt profile in light of the World Bank’s fresh commitments.

While acknowledging that borrowing is not inherently bad for an economy, he questioned the rationale for taking on more debt at a time when the government claims to have higher revenues. Ilias pointed out that following the removal of fuel subsidy, Tinubu had announced increased revenue inflows.

He added that both the Federal Inland Revenue Service and the Nigeria Customs Service had declared revenue surpluses, further suggesting the government should be able to fund projects without resorting to heavy borrowing.

According to him, the impact of the current borrowing spree is being felt in reduced public service delivery, particularly in capital expenditure, as debt servicing now consumes a significant portion of available revenue.

He warned that this crowding-out effect limits job creation, fuels inflation, and worsens Nigeria’s foreign-exchange imbalance, with the naira trading at historically low levels.

He argued that given the claimed revenue surpluses, the Tinubu administration should not have needed to borrow within its first two years in office, let alone at the scale currently being witnessed.

Economist and CEO of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, said the rising World Bank commitments to Nigeria should be examined within the context of the country’s Medium-Term Expenditure Framework and annual budgets, which already provide for both domestic and foreign borrowing.

He noted that deficit financing is a common feature of budgets worldwide and is not inherently wrong, as it allows governments to make critical investments without waiting to generate all the required revenue upfront.

However, he stressed that borrowing should always be backed by sound economic reasoning and clear development priorities. Yusuf emphasised that the key issue is debt sustainability, which depends primarily on the country’s revenue capacity to service its obligations.

Without strong cash flow to meet repayment schedules, he warned, Nigeria risks falling into a vicious cycle of borrowing to service existing loans, thereby perpetuating fiscal vulnerability. He said it is essential that projects funded by loans directly support the economy’s capacity to repay.

According to him, Nigeria should be cautious with foreign loans due to the exchange rate risks they pose, noting that domestic debt is generally easier to manage. Excessive foreign borrowing, he warned, could put pressure on the country’s reserves and further weaken the exchange rate. He stressed that a disciplined approach to debt sustainability will be crucial for Nigeria to avoid long-term fiscal distress.

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Meanwhile, data from the Debt Management Office showed Nigeria’s external debt stood at $46.98bn as of June 30, 2025. Of this amount, the World Bank Group accounted for $19.39bn—comprising $18.04bn from the International Development Association and $1.35bn from the International Bank for Reconstruction and Development.

This means the World Bank holds 41.3 per cent of the total, reinforcing its outsized role in funding Nigeria’s development programmes.

The Minister of Budget and Economic Planning, Senator Abubakar Bagudu, recently called on the World Bank to support Nigeria’s Renewed Hope Ward Development Programme, a grassroots initiative he described as central to achieving President Bola Tinubu’s target of building a $1tn economy by 2030.

The minister praised the World Bank for its consistent backing of Nigeria’s reforms, describing the last 28 months of partnership as both challenging and transformative. “The World Bank team has collaborated with us not just as partners but as members of the same team. We could not have achieved the results we have today without your support,” he said.

Speaking with the minister in August 2025, the World Bank Country Director, Matthew Verghis, commended Nigeria for making bold decisions that could reset its development trajectory.

“Nigeria’s recent decisions represent a critical moment. Such choices are not easy, but they create opportunities for a new path,” Verghis said. “The World Bank stands ready to continue supporting Nigeria in maintaining these reforms and increasing their impact.”

However, The PUNCH also reported in September 2025 that about six loans worth $2bn, signed for Nigeria by the World Bank in 2024, were yet to be disbursed nearly a year after the bank’s approval.

Responding to an enquiry by The PUNCH, the Senior External Affairs Officer at the World Bank, Mansir Nasir, noted that funds for projects financed by the institution were not disbursed at once but in instalments, depending on the nature of the project and financing instruments.

“Projects financed by the World Bank run for a certain time, which varies depending on the specific project. The total amount of the project is not disbursed as a one-off, but rather in instalments depending on the financing instruments—e.g., IPF or PforR—which require certain milestones for specific disbursement values.

“If you look at the portal, you will see the specific disbursement timelines and values,” Nasir added. He further stated that before a new project can begin disbursement, it must meet certain agreed conditions between the Federal Government and the World Bank.

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Abia begins relocation of transport operators to new terminal

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The Abia State Government has commenced the enforcement of its new centralised transport system in Umuahia, with the phased relocation of transport operators to the Nnenna Otti Bus Terminal, Umuahia.

The Commissioner for Information, Okey Kanu, made this known at Government House, Umuahia, on Tuesday while briefing newsmen on the outcome of this week’s State Executive Council (EXCO) meeting presided over by Governor Alex Otti.

The commissioner disclosed that, in order to ensure compliance by transport operators, the state government took time to hold a series of meetings with transport stakeholders, during which their concerns were addressed.

Kanu added that, following the steps taken by the government, full operations had commenced at the terminal, with informal transport operators and unions already moved to the facility, despite the normal resistance that accompanies change.

“There appears to be some push backs among some of the operators and this is as a result of the fact that people are not easily giving in to change.

“What is happening is that all the parks in the state have been moved to the bus terminal.

“The Honourable Commissioner for Transport and his team have been holding a series of meetings with all the operators. They had one yesterday. And a few of their anxieties will be addressed very soon. Enforcement also will commence today to bring all the operators into the terminal.

“The first phase of operations involves the operations of the Abia Green Shuttle buses. The second phase involves informal transport operators, while the third phase will involve the formal transport operators,” Kanu stated.

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Answering questions from newsmen, the Commissioner for Transport, Dr Chimezie Ukaegbu, said the state government had not taken away anybody’s means of livelihood but had instead introduced a more organised system to sanitise the transport sector and improve it.

He revealed that transport unions and operators were told to bring four of their workers each to the terminal, where they would be properly identified with reflective tags and carried along.

He further noted that the terminal operates a transparent system that allocates loading opportunities on a first-come, first-served basis irrespective of union affiliations, insisting that about 80 to 90 per cent of operators had embraced the initiative. He added that continuous engagements were being held with those yet to fully comply with the government’s transport policy.

He equally noted that the government provided a drivers’ lodge, fully air-conditioned and furnished with seats, while passengers sit in a conducive air-conditioned environment, adding, “what else will you need as a transporter or even as a passenger? I think everything good about transportation is embedded in that Nnenna Otti Bus Terminal,” Ukaegbu stated.

Contributing, the Special Adviser to the Governor on Media and Publicity, Mr Ferdinand Ekeoma, said that the centralisation of transport operations would reduce urban congestion, indiscriminate loading bays, expenses incurred by transport operators on their loading bays, and security challenges associated with the influx of unregulated transport operators, thereby enabling transport operators to make more gains.

He added that, over the years, “we have seen transport operators extort people, by coming up with this organised system, we are solving our problems,” Ekeoma stated.

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Court orders Virgin Atlantic to pay N13m for missed flight

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A Federal High Court in Lagos has ordered Virgin Atlantic Airways Limited to pay Mrs. Joy Ezetah the sum of $5,906.50 in damages after it failed to allow her board a scheduled Lagos-London flight, an incident that disrupted her onward trip to Canada and caused her financial loss.

Justice Ibrahim Kala in the judgement delivered on Monday, held that the airline was liable for the losses suffered by the claimant after she was denied boarding at the Murtala Muhammed International Airport on 6 April 2024.

The claimant had asked the court for N100m in general damages, arguing that she bought a business-class ticket through Air Canada for a four-leg trip from Lagos to Toronto and back, but was stopped from boarding the Virgin Atlantic flight “without justification.”

She told the court that she arrived early, completed check-in, and was issued a boarding pass for the Lagos-London leg.

According to her, airline officials later prevented her from boarding, stating they could not connect her ticket to her Air Canada connecting flight from London to Toronto.

Ezetah stated that the airline owed her a duty of care and should have resolved the issue with Air Canada or made other arrangements instead of denying her boarding.

She further maintained that when she later contacted Air Canada, the airline confirmed that her ticket was valid and that she was expected on the connecting flight.

Virgin Atlantic, however, denied liability. It said it was “not the issuing carrier” and insisted that the ticket had been purchased directly from Air Canada under a codeshare arrangement.

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The airline also argued that an error code in the reservation system prevented it from issuing a boarding pass for the connecting flight and that it acted professionally by advising the passenger to contact the ticket issuer.

It further contended that the claimant’s inability to complete online check-in before arriving at the airport showed that there was already a problem with the ticket.

After reviewing the evidence, submissions and legal authorities cited by both sides, Justice Kala held that the claimant’s case had merit.

The court awarded $5,906.50 in damages against Virgin Atlantic and ordered that the sum be paid using the prevailing exchange rate published by the Central Bank of Nigeria. Based on the highest official rate of N1,365.50 to a dollar, the award translates to about N8.07m.

Justice Kala also ordered the airline to pay 10 per cent interest per annum on the judgment sum until full liquidation of the debt.

Additionally, the court awarded N5m as costs against Virgin Atlantic, noting that the claimant had been forced to approach the court to enforce her rights.

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States kick as Senate moves to amend Electricity Act; read details

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A fresh battle over the control of Nigeria’s electricity sector is brewing, as state electricity regulators have accused the National Assembly of attempting to claw back powers already devolved to states under the Constitution and the Electricity Act 2023.

In a strongly worded memorandum submitted to the Senate Committee on Power and obtained by our correspondent on Tuesday, electricity regulatory commissions and bureaus from 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.

The concerns were contained in a letter dated May 26, 2026, addressed to the Chairman of the Senate Committee on Power and signed on behalf of the State Electricity Regulatory Commissions and Bureaus.

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 noted that they had earlier met with the Senate committee and were subsequently requested to consolidate their concerns into a single memorandum for the consideration of lawmakers, the Nigerian Electricity Regulatory Commission and other stakeholders.

The letter stated, “We represent State Regulatory Commissions/Bureaus that have taken advantage of the Electricity Act 2023 to commence the development of our sub-national electricity markets and sectors.

We are grateful for the audience you granted us to raise concerns on the ongoing consideration of the proposed Amendment Bill 2026 to the Electricity Act 2023.

“As agreed during our discussion, we have collated and consolidated the comments into one document which is hereby attached for the consideration of the Senate and House Committees on Power, NERC and other stakeholders.”

The state electricity regulators 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.

Other disputed clauses relate to restrictions on states’ participation in the wholesale electricity market, matters concerning the Nigerian Wholesale Electricity Market, the authority of states over independent transmission and distribution networks, and the establishment and administration of the Power Consumers Assistance Fund.

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.

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They further opposed provisions designating electricity generation, transmission, distribution and supply as essential services, as well as clauses dealing with government-owned enterprises as licensees and obligations to host communities.

Additional areas of contention include the regulation of intra-state electricity matters that may have implications for the national grid, the imposition of timelines and phased conditions for states transitioning into independent electricity markets, and proposed federal oversight on consumer protection, anti-trust measures and tariff design within state electricity jurisdictions.

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

“A review of the Bill suggests that the general intention is to reverse the devolution of legislative, governance and regulatory powers over electricity matters that occur solely within the respective states to the state governments, in favour of a reconsolidation of powers at the federal level, with the Nigerian Electricity Regulatory Commission retaining full supervisory powers over the market. Effectively, it appears that the intention of the Bill is that Nigeria should continue with the same regime that, for 20 years, has not led to any significant increase in power availability or per capita consumption for Nigerians, despite ever-increasing (and unsustainable) federal debt.”

At the centre of the dispute is the interpretation of the constitutional amendments that allowed states to legislate on electricity matters within their territories. The regulators argued that the proposed amendment bill wrongly assumes that state legislatures derive their powers from the National Assembly rather than directly from the Constitution.

According to them, any attempt by the National Assembly to grant, restrict or redefine those powers through ordinary legislation would amount to a constitutional violation.

The memorandum stated, “Section 2 of the Bill aims to amend Section 2(2)(a)-(e) of the Principal Act. By that section, the National Assembly reserves to itself the power to delegate legislative powers to States’ Houses of Assembly, suggesting that the Bill (or the Principal Act) is the source of the powers of a state to make laws on its electricity markets.

“This provision is based on a shocking miscomprehension of Nigerian constitutional law—it proceeds from the wrong assumption that the NASS, by ordinary legislation and not constitutional amendment, can confer (or restrict) the legislative power of states.

“The constitutional division of powers is fundamental to federalism, ensuring a balance between national unity and state autonomy. There is no legal framework for the NASS to ‘empower’ state governments to make law by ordinary legislation, as the language of the Bill attempts to do.

“The constitutional division of powers is fundamental to federalism, ensuring a balance between national unity and state autonomy. There is no legal framework for the NASS to ‘empower’ state governments to make law by ordinary legislation, as the language of the Bill attempts to do. Consequently, Section 2 of the Bill, seeking to amend Section 2 of the Act, is not consistent with the Constitution.”

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The regulators described as “a shocking miscomprehension of Nigerian constitutional law” the provisions of the bill that appear to suggest that the National Assembly is the source of states’ authority over electricity matters.

They warned that the proposed law could undermine the principle of federalism by weakening state autonomy. Beyond constitutional concerns, the regulators said the bill could create uncertainty in the electricity market and discourage investors who had already committed resources based on the existing legal framework.

“The clear intention behind the new drafting is to reconsolidate in the Federal Government matters solely within the state electricity markets which had been devolved to the states,” the memorandum stated.

“This will defeat the key objectives of the Electricity Act and the various states’ electricity laws, even before the regime introduced by them has taken any root. It will introduce avoidable disruption in the industry as significant investment decisions have already been taken based on the Electricity Act 2023, and these investments are now put at risk by this proposed amendment.”

The state regulators specifically faulted provisions relating to federal oversight of activities connected to the national grid, restrictions on state authority over wholesale electricity transactions, the proposed expansion of NERC’s powers and changes affecting mini-grids and independent distribution systems.

They argued that allowing NERC to retain overriding authority over electricity activities merely because they have some connection to the national grid would effectively render state powers meaningless.

The memorandum stated, “What is required, in order to attain the full benefits of the decentralisation of the Nigerian Electricity Supply Industry that is the theme of the Fifth Alteration and provided for in the Principal Act, is proper coordination on transmission matters between NERC and state regulators, and not top-down federal legislation.”

The regulators also rejected provisions that would permit NERC to exercise final administrative appellate jurisdiction over disputes involving state electricity regulators. According to them, NERC and the SERCs are on equal standing within their respective constitutional spheres of authority.

“NERC and the SERCs are on equal standing within their respective constitutional spheres of authority,” the memorandum said. “The National Assembly cannot arrogate to NERC quasi-judicial authority over SERCs, especially where the dispute might be on a matter over which NERC has no authority.”

They further argued that the Constitution already vests judicial powers in the courts and that such responsibilities cannot be transferred to a regulatory agency. The proposed establishment of a Forum of Electricity Regulators also drew criticism.

Although the regulators acknowledged the importance of coordination among electricity regulators, they argued that participation in such arrangements should be voluntary rather than imposed through federal legislation.

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“The better approach would be a Memorandum of Understanding or similar instrument jointly negotiated by all relevant regulatory bodies in which the principles of coordination and harmonisation will be agreed,” they said.

The state regulators equally opposed provisions declaring generation, transmission, distribution and supply of electricity as essential services covering both federal and state electricity markets.

According to them, such provisions could inadvertently expand NERC’s jurisdiction into areas already devolved to states, including tariff regulation. “The provision is invidious, regressive and should be expunged,” the memorandum stated.

The regulators also faulted proposals empowering NERC to determine contributions to the Power Consumers Assistance Fund from electricity consumers. They argued that since electricity tariffs and retail supply have become matters for state regulation, decisions relating to subsidies and customer contributions should similarly reside with state authorities.

Other contentious areas identified by the regulators included host community obligations, the role of the Nigerian Electricity Management Services Agency, licensing arrangements involving government-owned electricity enterprises and timelines for states transitioning into independent electricity markets.

The dispute highlights the growing tension between the Federal Government and states over the future structure of Nigeria’s electricity industry. The Electricity Act 2023 was enacted following the Fifth Alteration to the 1999 Constitution, which removed electricity from the Exclusive Legislative List and empowered states to generate, transmit and distribute electricity within their territories.

Since then, several states have enacted electricity laws and established regulatory agencies to oversee emerging sub-national electricity markets. Lagos, Enugu, Ekiti, Ondo, Edo and other states have already commenced varying stages of implementation of their electricity reform programmes.

Energy experts have repeatedly described the decentralisation of the sector as a major opportunity to attract investment, improve efficiency and expand access to electricity. However, the latest amendment proposals appear to have reopened the debate over how regulatory powers should be shared between Abuja and the states.

As the National Assembly continues deliberations on the amendment bill, the position adopted by lawmakers could shape the future direction of Nigeria’s electricity reforms and determine whether the country deepens its experiment with decentralisation or returns to a more centralised regulatory model.

The Electricity Act 2023 was designed to operationalise the constitutional amendments that empowered states to participate directly in electricity generation, transmission and distribution within their boundaries. Since its enactment, several states have passed their own electricity laws and established regulatory commissions.

The proposed Electricity Act (Amendment) Bill 2026 seeks to amend several provisions of the principal legislation. However, state regulators contend that some of the proposed changes amount to an attempt to reverse the gains of decentralisation and restore broad federal control over the Nigerian Electricity Supply Industry.

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