Overview: Nigerian Electricity Management Services Authority (NEMSA) Act

In May 2015, the National Assembly recently enacted a bill to establish The Nigerian Electricity Management Services Authority (NEMSA).

According to section 1 (3) the NEMSA is intended to take over the management of a company called the Electricity Management Services Limited (the EMSL). A governing board will also be established for the Authority, the powers of the board shall be to, make broad policy and oversee the affairs of the Authority, provide policy guidelines for carrying out the functions of the Authority, approve the payment to the staff of the Authority such remunerations and allowances as are approved, approve appointment, promotion and discipline of management staff and do such things as are necessary and expedient for the efficient performance of the functions of the Authority.

The bill is enacted to carry out the functions of Electrical inspectorate services for the NESI; To ensure that all major electrical materials and equipment used in Nigeria are of the right quality and standards; To ensure the power systems and networks put in place have been properly executed be fore use, to ensure that such systems are capable of delivering safe, reliable and sustainable electricity supply to consumers nationwide; To specify technical standards for electrical plants, electric lines and connectivity to the grid; To specify safety requirements for construction, operation and maintenance of electrical power plants, transmission system, distribution networks and electric lines; To specify the conditions for installation of meters for transmission systems, distribution networks and supply of electricity; To carry out the duties of inspecting engineers for inspection testing and certification of all categories of electrical installation in the NESI; To provide comprehensive technical support services that will guarantee the efficient production and delivery of safe and reliable power supply and enhance efficient service delivery industry-wide; To provide sustained technical inspection, testing and certification of all electrical material, equipment, power systems, networks (generation, transmission and distribution), electrical installations etc to be used in the power sector, to ensure a stable system to deliver safe , reliable, regular power supply, guarantee safety of lives and property and avert loss of lives and property in the NESI; etc.

In addition to assuming the functions of the EMSL, other functions of the authority include the issuance of competency certificates/electrical installation licences to qualified electrical personnel and contractors working in NESI and enforcing all statutory technical electrical standards and regulations amongst others.

The authority has the right of access to all premises and the records of any institution or establishment material supply and installation and where the notice is served on any institution such an institution is required to furnish information on such matters as may be specified by the notice.

There are two opposing reactions in relation to the passing of this bill; the seventh Senate expressing optimism believed that the new NEMSA Act would help remedy the current power outages experienced the country and would also boost the electricity industry and ensure technical standardisation which in turn would curb domestic fires.

Advocates of the bill have expressed the view that the establishment of NEMSA will also afford the Nigerian Electricity Supply Industry (NESI) the opportunity to develop its technological capacity in the area of enforcement of technical and safety standards, inspection, testing and certification responsibilities. This will ensure that the right technical specifications, standards and quality of materials and equipment are used in the generation and delivery of electricity supply to consumers. Furthermore, it will enhance the efficiency and guarantee safety of lives and property in the NESI.

It is also believed that in a well-organised power sector, it is always better to have an enforcement agency of government separate from those who make the regulations for the industry, as this will support oversight.

On the other hand, those who oppose the Act have expressed concern over the regulatory uncertainty the establishment of this Authority will introduce into the power sector. The new Act appears to duplicate the functions required to be performed by the Nigerian Electricity Regulatory Commission (NERC). Under section 31 (1) (e), NERC is required to ensure the safety, security, reliability and quality of service in the production and delivery of electricity to consumers. Under section 32 (2) (b), NERC is required to establish, or as the case may be, approve appropriate operating codes and safety, security, reliability and quality standards. The functions required to be performed by the NEMSA Act set out in section 6 of that Act (set out above) include to ensure and test the safety and standards of electrical materials and operating systems in use in Nigeria as well as safety standards for the construction, operations and maintenance of power plant. A comparison of both pieces of legislation makes it clear that standards and policy setting was already addressed by the NERC Act in 2005, while the NEMSA Act of 2015 provides specific detail on electrical standards. It is therefore suggested that the functions of the NEMSA Act could have easily been implemented by a department within NERC. Intervention or oversight function by an additional government body (either via regulations/policies or the creation of more governmental agencies) will create a convoluted bureaucracy which will increase costs – both of doing business and of executive spending.

It is therefore important to carefully understand the functions of NERC vis-a-vis the proposed functions of NEMSA and to objectively determine how these functions can be streamlined and also to provide clarity to operators within the sector.

Oyinda Omisore works as a legal practitioner in Lagos.