NERC issues license to companies for power generation
The Nigerian Electricity Regulatory Commission (NERC) has issued permits to Golden Penny Power Limited, MTN Communications Nigeria Limited, Havenhill Synergy, and others for mini-grid electricity generation. In the first quarter of 2024, the commission issued nine new off-grid generation licenses with a gross capacity of 109.69 megawatts and three new trading licenses.
Golden Penny Power Limited was granted a license to build six off-grid gas plants in Lagos, Oyo, Ogun, and Cross River states, totalling 100MW while MTN was granted a permit to build four captive generation plants across Lagos State with 15.94MW capacity.
SweetCo Foods Limited, African Steel Mills Nigeria Limited, West African Ceramics Limited, Royal Engineered Stones Limited, and Armilo Plastics Limited were permitted to generate captive power.
The commission also issued nine captive power generation permits in 2024/Q1 with a total nameplate capacity of 52.57MW. Other licensed companies for mini-grids include Daybreak Power Solutions, TIS Renewable Energy Limited, Auro Nigeria Private Limited, Watts Exchange Limited, Centum Dopemu Energy Services Ltd, and DMD Electric Limited Lagos State.
Section 165(1)(m) of the Electricity Act 2023 allows the commission to award licenses of mini-grid concessions to renewable energy companies to exclusively serve a specific geographical location indicating aggregate electricity to be generated and distributed from a site with the obligation to serve customers to request service.
The commission has continued to encourage the development and utilization of renewable energy by issuing permits and registration certificates for mini-grid development.
Types of Licenses Granted
- Off-Grid Generation Licenses: Five new licenses were issued for off-grid generation, which collectively can generate 8.81 MW. These licenses are crucial for promoting localized energy solutions that can operate independently from the national grid.
- Embedded Generation License: One license was granted for embedded generation with a capacity of 5 MW. Embedded generation refers to power plants that are connected directly to the distribution network rather than the transmission network, allowing for more efficient energy delivery.
- Independent Electricity Distribution Network (IEDN): One new license was issued for an IEDN, which allows companies to distribute electricity independently within certain areas.
- Electricity Trading License: A new license was also granted for electricity trading, enabling companies to buy and sell electricity within the market framework established by NERC.
The recent issuance of licenses by NERC marks a pivotal moment in Nigeria’s efforts to enhance its power generation capabilities through increased private sector involvement. By facilitating off-grid solutions and independent distribution networks, these initiatives aim not only to improve access to electricity but also foster competition within the energy market.
Writing by Jennifer Ogor; Editing by Daniel Adejo
