In furtherance of its statutory mandate to license, regulate, and promote an efficient electricity market within Ondo State, the Ondo State Government, through the Ondo State Electricity Regulatory Bureau (OSERB), has formally notified the Nigerian Electricity Regulatory Commission (NERC) of its approval of the leasing arrangement between the Ondo State Power Company (OSPC) and the Niger Delta Power Holding Company (NDPHC).
The approval covers the utilisation of the 33kV distribution line spanning Omotosho to Rubber Estate, as well as the 30km 33kV line extending to Fortune University, Igbotako, all situated within Ondo State.
Briefing journalists after a high-level strategic meeting, the Honourable Commissioner for Energy and Mineral Resources, Engr. (Dr.) Johnson Alabi, alongside the Chairman of the State Transitioning Committee, Engr. Tunji Light-Ariyomo, and the State Coordinator of OSERB, Engr. Stephen Bolawole, FNSE, expressed concern over continued regulatory interference by NERC in matters that fall squarely within the jurisdiction of the State.
The Commissioner stated unequivocally that following the formal handover of the affected electricity infrastructure by NDPHC to the Ondo State Government, all regulatory authority over such assets now resides with OSERB, in line with extant constitutional and statutory provisions.
He described any attempt by NERC to issue directives or reassign operational control over these assets as ultra vires, legally unsustainable, and an abuse of regulatory authority, noting that such actions undermine the evolving federal–state electricity governance framework established under Nigerian law.
REGULATORY ASSET BASE (RAB) JUSTIFICATIONEngr. Alabi further anchored the State’s position on the well-established principle of Regulatory Asset Base (RAB), which governs the recognition and valuation of electricity assets for regulatory and tariff purposes.
He explained that:
•The Omotosho 33kV network and associated lines, having been formally handed over for use and operational control within Ondo State, now form part of the Regulatory Asset Base of the Ondo State electricity market.
•Under established regulatory principles, assets can only be recognised within the RAB of the jurisdiction where they are operationally controlled, regulated, and utilised for service delivery.
•Consequently, only the competent regulator within that jurisdiction in this case, OSERB has the authority to approve, regulate, and determine the commercial utilisation, leasing, and tariff treatment of such assets.
He emphasized that allowing a federal regulator to exercise control over assets already integrated into a State’s RAB would result in:
•Regulatory duplication and conflict
•Distortion of tariff determination frameworks
•Uncertainty in investment recovery mechanisms
•Breakdown of accountability in service delivery
“Once an asset is operationally domiciled within a State electricity market and recognised for regulatory purposes, its governance must align with the regulatory authority responsible for that market,” the Commissioner stated.
CLEAR POSITION ON JURISDICTIONFor the avoidance of doubt, the Commissioner reaffirmed that OSERB has formally approved the transfer and utilisation of:
•The 54km, 33kV Omotosho distribution line, and
•The 30km Fortune University feeder line, from NDPHC to the Ondo State Power Company.
He stressed that NERC has no residual jurisdiction over distribution assets that have been duly transferred and operationally integrated into the Ondo State electricity market, and therefore cannot lawfully reassign, interfere with, or override decisions relating to such assets, including any attempt to allocate them to other operators such as BEDC Electricity Ondo Limited (BEOL).
According to him, any such action constitutes a direct violation of statutory provisions and a regressive attempt to perpetuate inefficiency in power delivery within the State.
LEGAL AND REGULATORY BASIS
The Commissioner referenced the OSERB Order dated April 23, 2026, addressed to the Chairman, Nigerian Electricity Regulatory Commission, which clearly establishes that:• OSERB assumed full regulatory oversight over BEOL’s operations in Ondo State effective October 22, 2024;
•Sections 70(1) and 70(2) of the Electricity Act, 2023 prohibit the transfer, lease, or affiliation of electricity undertakings without the consent of the relevant regulator;
•The Omotosho 33kV network constitutes distribution infrastructure geographically located within Ondo State, and is therefore subject to OSERB’s regulatory jurisdiction.
He further cited:
•Section 2(2) of the Electricity Act, 2023, which expressly recognizes the powers of States to enact laws and regulate electricity markets within their territories; and
•Section 230(6) of the Act, which provides that: “On the completion of the transfers under subsection (2) and (3), whichever occurs later in time, the Commission shall have no further regulatory responsibility over the transferee company whose regulatory oversight has been transferred.
”CONSTITUTIONAL POSITION
The Commissioner reiterated that OSERB derives its authority from:
•The Constitution of the Federal Republic of Nigeria, 1999 (as amended), particularly the Concurrent Legislative framework on electricity; and
•The Ondo State Electric Power Sector Law, 2020, which vests the State with legislative and regulatory competence over electricity generation, transmission, and distribution within its territory.
He emphasized that the relationship between NERC and State regulators is not hierarchical, but one of constitutional concurrency, where each level of government exercises authority within its defined jurisdiction
.COMMITMENT TO MARKET DEVELOPMENT
Engr. Alabi assured that the Ondo State Government, through OSERB, will continue to:• Protect electricity consumers,
•Ensure fair and efficient market operations, • Promote investment certainty, and
•Enforce regulatory discipline among all operators within the State.
FINAL APPROVAL AND WARNING
Consequently, OSERB has formally approved the leasing arrangement between the Ondo State Power Company and NDPHC for the utilisation of the Omotosho 33kV network within Ondo State.
The Bureau, however, cautioned that:Any operation, directive, or interference outside the scope of this approval, or in violation of its conditions, shall constitute a regulatory breach and shall attract appropriate sanctions under applicable laws.
Debbie Funmilayo
Information Officer
Ministry of Energy and Mineral Resources
