The Devolution of Power Bills and its impact on States and their Governors

The Nigerian president, Muhammadu Buhari on March 18th, 2023, signed several new bills into law, the bills are set to change the process of governance in Nigeria, particularly at the state level. The most significant of this bills is the Fifth Alteration Bill No. 33, Devolution of Powers (National Grid System), which states that Nigeria’s 36 states can now join the electricity generation business. The constitutional amendment allows states to generate, distribute and sell electricity. This is expected to decentralize the electricity sector and encourage private sector investment, leading to benefits such as increased competition, improved access to electricity, and job creation. However, challenges such as inadequate infrastructure and political interference may hinder its implementation.

Another Constitutional alteration approves the renaming of the Nigeria Prison Service to the Nigeria Correctional Service -Fifth Alteration Bill No. 31, Devolution of Powers for Correctional Services, the Act, which was signed on 14th August 2019, repeals the Prison Act, Cap P29, Laws of the Federation, 2004 and enacts a Nigerian Correctional Services Act to address issues that were not covered under the repealed Act and improve on prison administration in the country. Another one of the Bills granted rights to the state governments to establish their own railway service – Fifth Alteration Bill No. 32, Devolution of Powers, Railways. With this, the railway moves from the Exclusive Legislative List to the concurrent list.

Like the president’s spokesperson, Tolu Ogunlesi put it “another landmark change: By virtue of the Presidential Assent, Nigerian States can now generate, transmit and distribute electricity in areas covered by the national grid. This wasn't allowed pre-amendment. This is genuine, realistic Restructuring — through the Constitution.” 

The significance of these bills cannot be overemphasized; for one, the Nigerian states can now freely participate in the energy market with states now allowed to generate their own electricity.

The policy change could potentially improve the availability and reliability of electricity supply in the country, as states would now have more autonomy to generate, distribute and regulate power within their respective territories.

There is also the case for investors who will be looking at making the most money out of strategically investing into the power generation of certain states. It is also expected that the legislation will promote efficiency and increase competition.

There is equally a constitutional amendment that gives financial independence to State Houses of Assembly and Judiciaries, which is a significant development in Nigeria’s governance structure, as it would ensure the autonomy and effectiveness of state governments.

While eyes will be on the federal and state government to see the extent of implementation of the policies, power is one of the issues that bedevil the country the most and the focus will be on state governors now that states can generate electricity. 

Nigeria has the potential to generate 12,522 MW of electricity from the existing infrastructure but it can only manage about 4,000 MW. For a population of over 200 million people, this is grossly insufficient. According to statistics by PowerAfrica – a US government-led partnership. 

How state governors, some of who have consistently complained about not having the ability to manage infrastructure around power due to the federal embargo will fare is yet to be seen. You can trust that at AdvoKC, this new responsibility on Governors will play a role in the analysis being carried out in the different meters of governors that we chose to rate. 

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