The Nigerian Electricity Regulatory Commission (NERC) has officially kicked off its Net Billing Regulations 2026, establishing a landmark framework that permits qualifying electricity consumers with renewable energy setups—especially solar—to produce their own power and feed the excess back into the national grid via distribution companies.
This move is set to fast-track the adoption of green energy across Nigeria, stimulate private investments in the power sector, and inject a much-needed boost of alternative supply into the country’s struggling distribution network.
In a public notice titled “Commencement of the Net Billing Regulations 2026” and released on Wednesday, the commission notified electricity consumers, distribution companies, renewable energy developers, commercial and industrial customers, and the general public of the commencement of the new regulatory regime.
According to the regulator, the framework is designed to transform eligible electricity customers into what it describes as “prosumers” — consumers who not only use electricity but also generate it.
The commission also specified that participating customers must have a “renewable energy system with a minimum installed capacity of 50 kilowatt peak and a maximum of 1.5 megawatt peak”.
It stated that the regulations establish a framework that enables “eligible electricity customers (prosumers) to generate electricity from renewable energy sources, primarily solar photovoltaic systems, for their own consumption and export surplus energy to the distribution network under a net billing arrangement.”
The arrangement effectively creates a pathway for businesses and institutions with large solar power installations to monetise excess electricity that would otherwise remain unused.
Under the framework, a customer with a solar power system will first consume electricity generated from the installation. If the system produces more electricity than is required at any given time, the excess energy can be exported into the distribution company’s network.
The amount of electricity exported will be measured through specially installed bidirectional meters capable of recording both electricity consumed from the grid and electricity supplied to it.
The exported energy will then be credited in accordance with tariffs approved by the commission. The regulation marks a significant shift from the traditional electricity consumption model in which customers solely purchase power from the grid.
Under the new arrangement, eligible customers can become small-scale power producers capable of supplying electricity back to the network.
NERC said the regulations are aimed at achieving several strategic objectives within the electricity sector.
According to the commission, the objectives of the Net Billing Regulations 2026 are to promote the adoption of renewable energy technologies, enhance energy security and reliability for electricity consumers, encourage private sector participation in distributed generation, support the reduction of greenhouse gas emissions, and facilitate efficient integration of renewable energy systems into distribution networks.
The regulation comes amid growing interest in alternative energy sources as businesses and households continue to seek more reliable and cost-effective power solutions.
NERC stated that participants must be connected to a distribution licensee’s network and install renewable energy systems that comply with applicable technical standards and regulatory requirements.
According to NERC, producers must obtain approval from the relevant distribution licensee, execute a net billing agreement, and register with the commission. The capacity threshold indicates that the scheme is targeted primarily at medium- and large-scale consumers rather than residential customers with small rooftop solar systems.
The commission said interested customers would be required to undergo technical evaluation before being admitted into the scheme. According to the notice, interested customers are required to apply to their distribution licensee for a technical feasibility assessment.
