Appraising NERC Chaiman Dr Oseni’s  paradigm shift in electricity market

In this article, Onu Okorie took a look at a number of reforms that the new Chairman of the Nigeria Electricity Regulatory Commission, NERC Dr. Musiliu Olalekan Oseni has brought into the sector in less than six months in the office as a sign of good omen for power stability in the country.In public policy initiatives, it is not how long that’s spent in the office that matters when it comes to delivering on the expectations of the people, rather it’s ability to be focused. 

For instance, it took the former Head of State, General Murtala Muhammed just six months to create lasting legacies after he took over the reins of power in Nigeria, but there are many administrations that came after him and spent a good number of years without anything to show for it. 

A popular axiom has it that ‘first impression always last long’. That’s exactly what seems to standout the new Chairman of the Nigeria Electricity Regulatory Commission NERC, Dr. Musiliu Olalekan Oseni as he takes steps to reposition the all important electricity Market and to address challenges facing the sector. In less than six months after his appointment, Dr Oseni has already initiated a number of reforms that are eye catching in power sector. One of such initiatives is the move to reduce energy loss in the transmission line. 

Recently, NERC issued Order on Regional Transmisssion Loss Factor TLF reporting for enhanced grid transparency and efficiency. The order dated April 8, 2026, is part of a new framework for regional transmission loss factor reporting designed to strengthen grid oversight and accountability, by the Commission.

It would be recalled that the Managing Director/Chief Executive Officer of the Nigerian Independent System Operator, NISO Abdu Bello, said Nigeria’s power sector was losing between N5bn and N8bn monthly to transmission inefficiencies, even as he revealed that targeted interventions by the operator have begun to cut losses and improve grid stability.

Also the Commission disclosed that a data obtained from the NISO showed that national average transmission losses exceeded approved benchmarks in recent years. “Data from the Nigerian Independent System Operator’s report indicates that the national average TLF stood at 8.71 per cent in 2024 and 7.24 per cent in 2025, both of which exceed the Multi-Year Tariff Order benchmark of 7 per cent approved by the commission,” the order said.

The order however, directed Transmission Company of Nigeria TCN to reduce transmission losses across the national grid to 6.5 per cent by December 31, 2026, as part of measures aimed at improving efficiency and transparency in the electricity transmission network. According to NERC, “TCN shall ensure that TLF across all transmission regions in NESI shall not exceed 6.5 per cent by 31 December 2026, in compliance with MTYO 2024 for TCN.” It also required TCN to submit a corrective plan for regions exceeding allowable limits. “TCN shall file a comprehensive action plan by 31 July 2026 on the reduction of TLF to a value within the approved benchmarks in regions where the TLF exceeds the allowable limits for approval,” it added.

The commission said the Transmission Loss Factor remained a key metric for assessing grid performance, explaining that it measures the difference between total energy injected into the transmission system and energy delivered at exit points. TLF therefore serves as a critical performance indicator for assessing grid efficiency, operational integrity of the transmission network, and the effectiveness of energy accounting within the grid.”

The NERC directive however, did not go unnoticed by stakeholders who hailed the NERC Chaiman Dr Oseni for taking the decisive step in the interest of the public. Some of the stakeholders stressed that the unfolding events is an indication to operators in power sector that it’s no more business as usual, rather it’s time to sit up and ensure that the Nigeria Electricity market is working.

Speaking on the issue during an interview with the Presidentstrides.ng, the President of the Nigeria Consumer Protection Network, Kunle Olubiyo said that it’s important that NERC rise up to the occasion where there is leakage in the system. According to him, “the transmission loss factor is a serious issue of great concern in Electricity market in Nigeria. It may arise from a number of factors, including ageing or inefficient network equipment, degraded infrastructure, and suboptimal operational practices. What NERC is doing is in order. TCN as an institution should invest in infrastructure and maintenance. If you don’t invest in maintenance and operational overall expenses, there’s no way you can equally expect the best from it. He said that most of the loses are incured as a result of obsolate infrastructure and poor maintenance culture.

Olubiyo who alleged that TCN present TCN management inherited huge amount of money from the predecessor but said that TCN chose to spend on frivolities at the expense of operational expenses. He stressed that the directive from NERC will help TCN to be focused. 

Also a public policy analyst and partner, The Crest Legal Practitioners Gideon Agbedo, lauded the NERC Chaiman Dr Oseni for taking such bold step to ensure efficiency in power sector. 

According to him, “as a regulator, what NERC Chaiman is doing is the right thing because the onus is on him to ensure efficiency and effectiveness in the power sector.” He however, argued that the question of reducing loss factor entails capital intensive and can only be achieved if TCN itself has the capacity to fund it now. “If transmission loss factor want to be achieved, it means that the investment on the transmission infrastructure need to also happen” he said. He said that the TCN may need to attract investment from either the government or private sector to achieve the target.

On the other hand, NERC also instructed the system operator to measure energy flows in transformers across transmission substations. “NISO shall install smart meters at all boundary regional interconnection points by 31 December 2026 to accurately measure energy inflows and outflows for each region of the transmission network.”

“NISO shall measure and document energy flow in and out of power transformers at all transmission substations to evaluate the compliance of the allowable loss value of the transformers in compliance with section 2.3.4.1 (b) of the Nigerian Electricity Supply and Installation Standards Regulations 2015,” it stated.

Furthermore, the commission mandated quarterly regional reporting of transmission losses. The order stated that NISO shall file quarterly reports on TLF to the commission on a regional basis no later than 30 June 2026 using a template provided in the order.

The commission warned that failure to comply with the order would attract sanctions, saying, “Non-compliance with the provisions of this order shall attract appropriate regulatory measures as prescribed in the Terms and Conditions of the defaulting Licensee’s Licence.

Another key step to improve regulatory function taken recently under the new NERC Chairman, Dr Oseni is the recent directive to owners of private transmission substations connected to the national grid to obtain regulatory permits within 45 days, as part of efforts to tighten oversight and improve the reliability of Nigeria’s power network. The directive, contained in Order No. NERC/2026/013 which took effect on March 9, 2026, establishes a new regulatory framework for privately owned transmission substations serving bulk electricity consumers. NERC insisted  in a public notice issued via its verified X handle, that the measure was designed to strengthen supervision of privately operated grid infrastructure. According to the Commission, the order mandates owners of such facilities to obtain an Independent Electricity Transmission Network Operator IETNO Permit before operating or connecting their substations to the national grid. The regulator explained that the decision followed frequent transmission line trips reported by the NISO, which have raised concerns over grid safety and operational visibility. Under the directive, NISO has been instructed to compile and submit to NERC a comprehensive list of all existing Private Transmission Substation Owners PTSOs. The system operator must also notify them of the new regulatory requirements within five days. Existing PTSOs are required to apply for the IETNO permit within 45 days of the order taking effect, while new operators must secure the permit before connecting their facilities to the grid. Failure to comply with the directive will attract regulatory sanctions. As part of the compliance framework, NISO will also deploy Internet of Things IoT-based metering systems at substation interconnection points within 120 days to strengthen monitoring and data transparency. Speaking also, Olubiyo said that commended NERC 

The NERC under Dr Oseni is also not leaving the performance of the distribution value chain to chance, following new regulations aimed at getting the DisCos to perform better. For instance, the Commission has directed DisCos to deploy Internet of Things IoT meters on key 33kV and 11kV feeders, a move aimed at eliminating blind spots in data collection and boosting transparency in energy accounting.

In addition to that, NERC has instructed the electricity distribution companies and meter asset providers to accelerate meter installations as part of efforts to close Nigeria’s metering gap.  This was part of the decisions taken during the NESI Metering Stakeholders’ Meeting held recently. NERC further explained that the meeting focused on improving coordination among key players to fast-track meter deployment and improve billing transparency in the power sector. The commission said there is “a shift in focus … from financing metering projects to better coordination among stakeholders.” It added that there was also a “move to align the coordination of the four metering programmes currently running to close the metering gap.” Speaking also Olubiyo said that it’s high time the issue of metering should be resolved in the electricity market because estimated billing gives room for a lot of uncertainties in the system. According to him, “the estimated billing gives room for free lunch for operators. It makes customers to pay for energy they did not concume. It’s incentive for inefficiency. So  improved metering would enhance transparency and billing accuracy across the sector. There no doubt that improved metering will ensure more accurate billing and help eliminate estimated billing.”

The NERC Chaiman, Dr Oseni, who recently chaired the Q1 2026 NESI Stakeholders’ Meeting held in Lagos emphasized a strategic shift toward proactive public engagement alongside other key sector issues. The meeting came up with a far reaching decisions that showed a paradigm shift but necessary to score stability in power sector.  Key highlights from the meeting include: progress on critical power infrastructure, including the Supervisory Control and Data Acquisition (SCADA) and Energy Management System (EMS) projects. The SCADA/EMS initiatives, once completed, are expected to reduce system disturbances and strengthen grid stability. And a renewed call for clear, consistent communication of sector projects and reforms to the public. Also there was emphasis on public awareness to help Nigerians understand the long-term benefits of ongoing reforms. Operators were urged to project hope and confidence, as effective communication is essential for sector progress