NERC unveils new mini-grid regulation to boost rural electrification

The Nigerian Electricity Regulatory Commission (NERC) has issued the Mini-Grid Regulations 2026 to guide the development, operation, and regulation of mini-grids across the country.

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In a statement issued on Monday, the commission said the regulatory document, numbered NERC-R-001-2026, provides a comprehensive framework for the deployment and management of mini-grids in Nigeria.

It noted that the move is aimed at expanding electricity access—particularly in unserved and underserved areas—while ensuring safety, fairness, and protection for investors.

Mini-grids are small-scale, integrated electricity generation and distribution systems that operate independently of the national grid to serve localised communities. Typically powered by renewable energy sources such as solar, hydro, or wind—or hybrid systems like solar-diesel—they offer reliable, cleaner, and often cheaper alternatives to conventional power supply.

Across rural Nigeria, individuals and private firms have increasingly turned to mini-grids to bridge the electricity gap. While major cities continue to grapple with unstable power supply, many rural communities remain without access to electricity due to their exclusion from the national grid.

To address this gap, energy companies have begun deploying mini-grids in strategic rural locations, providing electricity services to communities for a fee.

Highlights of the regulation

NERC said the regulation applies to isolated mini-grids operating independently of distribution company (DisCo) networks with capacities of up to 5 megawatts (MW), as well as interconnected mini-grids linked to existing distribution networks with capacities of up to 10MW.

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The framework covers developers, operators, distribution companies, and host communities. It also aligns with the Electricity Act 2023 and accommodates state-level regulation where applicable.

According to the commission, mini-grids below 100 kilowatts (kW) can be registered, while those above that threshold require a permit from NERC. Permits are to be granted within 30 business days following a completed application process.

Operators are required to submit annual reports for mini-grids below 1MW and quarterly reports for those above 1MW. NERC will also carry out continuous monitoring and may publish sector-wide data.

The commission said the regulation is designed to accelerate rural electrification, attract private investment, ensure fair tariffs and consumer protection, and strengthen coordination between mini-grid developers and DisCos.

Broader sector reforms

The new regulation comes amid ongoing reforms in Nigeria’s power sector. Earlier, PREMIUM TIMES reported that NERC has issued updated guidelines on the reporting of regional electricity Transmission Loss Factors (TLF) to improve transparency and efficiency in grid operations.

READ ALSO: Tinubu inaugurates committee on Grid Asset Management Company

Nigeria’s electricity sector continues to face longstanding challenges, including weak infrastructure, frequent grid collapses, and persistent supply shortages. As a result, households and businesses increasingly rely on petrol and diesel generators, as well as solar alternatives, driving up operating costs.

These additional costs are often transferred to consumers through higher prices of goods and services.

In a related development, President Bola Tinubu recently approved a N3.3 trillion payment plan to settle outstanding debts under the Presidential Power Sector Financial Reforms Programme.

The presidency said the liabilities, accumulated between February 2015 and March 2025, were reviewed and verified before arriving at the final settlement figure.