Restructuring of Electricity Market in Nigeria: Deregulation and Privatization of Electricity Sector

The power sector has suffered a lot of neglect and mismanagement over the years resulting in low power generation, high energy losses and high load factors leading to inability to cope with peak daily demand. The mode of operations in PHCN such as mode of payment, use of unreliable database, poor customer services, method of distribution of bills and meter reading have also contributed to inefficiency in the sector. After examining the structure of electricity market in Nigeria; deregulation and privatization seem to be the perfect tool to the ongoing restructuring process. In this deregulation and privatization, there will be three main key players namely; Government, Investors and Consumers who must not have conflict of interest in order to maintain the three key elements of deregulation and privatization: good Tariff, Competition and equal Market Power among market participants. Government, through its political, legal, and regulatory institutions creates policies and contracts which deregulation and privatization are based on. Most times these policies and contracts are manipulated to favour politicians hence they have major shares of the privatized ....