NERC issues mini-grid regulations, mandates permits for operators of systems above 100kW

The Nigerian Electricity Regulatory Commission has issued new mini-grid regulations for 2026, establishing a framework to guide the development, operation, and regulation of mini-grid systems across Nigeria, with a focus on expanding electricity access in communities that remain unserved or underserved by the national grid.

The regulations, announced on Monday, are designed to ensure safety, fair tariffs, and investor protection while strengthening coordination between mini-grid developers, operators, distribution companies, and host communities in line with the Electricity Act 2023.

What the regulations cover

The framework applies to two categories of systems: isolated mini-grids, which operate independently of distribution companies with capacities of up to 5 megawatts, and interconnected mini-grids, which are connected to existing distribution networks with capacities of up to 10 megawatts.

Mini-grids below 100 kilowatts are required to be registered, while those above that threshold must obtain a permit from NERC. The commission said it would process permit applications within 30 business days. Operators of mini-grids below 1 megawatt must submit annual reports, while those above 1 megawatt are required to file quarterly reports. NERC said it would conduct ongoing monitoring and may publish sector data.

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Cutting transmission losses

Separately, NERC has issued an order to improve transparency in Nigeria’s power grid by establishing a formal framework for reporting regional transmission losses. Data from the Nigerian Independent System Operator showed that the national average transmission loss factor stood at 8.71 per cent in 2024 before falling to 7.24 per cent in 2025 — still above the 7 per cent benchmark set by NERC under its Multi-Year Tariff Order.

Taking effect from 13th April 2026, the order requires NISO to install smart meters at all regional interconnection points by December 2026 and submit quarterly transmission loss reports to NERC on a regional basis. The Transmission Company of Nigeria has been directed to submit a comprehensive action plan by July 2026 outlining steps to bring losses within the approved benchmark, with a target of no more than 6.5 per cent across transmission regions by December 2026.

NERC said the order is designed to strengthen accountability in transmission operations and support better grid performance through structured loss reporting.