You and Nigeria Electricity

Establishment and Corporate Status

• Creation: The REA is established to handle rural electrification projects.
• Corporate Body:
• Perpetual succession and a common seal.
• Can sue or be sued.
• Can deal with both movable and immovable property.

Objectives

1. Market Entry and Coordination: Create channels for entry into rural electrification markets, coordinating with corporate bodies to supply services and facilities.
2. Efficient Service Provision: Ensure that electrification services in rural areas are efficient, economical, and meet performance standards for social, industrial, and agricultural needs.
3. Policy Implementation: Promote and implement government policies on rural electrification.
4. Electricity Access: Enhance access to electricity for rural, unserved, and underserved populations.
5. Off-Grid Electrification: Promote off-grid solutions to reach areas not connected to the main grid.
6. Renewable Energy Framework: Support the development and utilization of renewable energy sources to attract investment and diversify energy supplies.
7. Special Programs: Implement special electrification programs and projects approved by the Federal Ministry responsible for power.

Functions

1. Universal Access Promotion: Drive the provision of affordable and sustainable electricity to improve the quality of life and economic opportunities in rural areas.
2. Reliable Power Supply: Ensure access to reliable electricity that supports reasonable returns on investment through economically responsive tariffs.
3. Fund Management: Oversee and execute the Rural Electrification Fund in accordance with operational guidelines.
4. Renewable Energy Development: Promote the use of renewable energy sources, collaborating with federal ministries, departments, and State Boards.
5. Educational Opportunities: Provide learning opportunities about rural electrification business ventures.
6. Low-Cost Project Promotion: Advocate for low-cost electrification projects that qualify for subsidy grants.
7. Tax and Investment Incentives: Facilitate tax incentives, investment allowances, and low-interest loans for local renewable energy product producers.
8. Economic Growth: Encourage economic growth in rural communities through electrification projects.
9. Ancillary Functions: Perform necessary ancillary functions to achieve its objectives.

Powers

1. Insurance: Insure its property against loss or risks.
2. Property Transactions: Acquire, purchase, hold, construct, maintain, and dispose of property required for its functions.
3. Zonal Offices: Establish zonal and liaison offices to facilitate its operations.
4. Gender Mainstreaming: Integrate gender considerations into rural electrification activities.
5. Fund Management: Manage funds from the Rural Electrification Fund for approved projects.
6. Data and Information Management: Collect, collate, process, and disseminate rural electrification data.
7. Additional Actions: Perform any other necessary actions to fulfill its functions under this Act.

Consultation and Stakeholder Engagement

• Consultation: The Agency consults with groups or individuals likely to be affected by its projects or programs, including investors, renewable energy companies, user cooperatives, State Rural Electrification Boards, and other stakeholders.

The following ensure effective governance, transparency, and efficient management within the REA, supporting its mission to enhance rural electrification.

Governing Board of the Rural Electrification Agency (REA)

Establishment and Composition

• Formation: The REA has a Governing Board (“the Board”) to exercise its powers and perform its functions.
• Membership:
• Seven Members:
  • Six members represent the six geopolitical zones of Nigeria.
  • One designated as part-time Chairman.
  • Two as Non-Executive Directors.
  • Three as Executive Directors.
• Managing Director and CEO.

Qualifications and Appointments

• Board Members: Appointed by the President on the Minister’s recommendation.
• Qualifications:
• Managing Director and Executive Directors: Must have relevant qualifications, experience, and competence.
• Part-time Chairman and Non-Executive Directors: Highly respected with distinguished careers in public service and the private sector.

Terms of Office

• Term Duration: Five years, renewable for one additional term of five years.
• Termination: Members cease to hold office if they:
• Become bankrupt.
• Are convicted of a felony or offense involving dishonesty/fraud.
• Become of unsound mind or incapable of duty.
• Commit serious misconduct.
• Are disqualified or suspended from practicing their profession.
• Resign by letter to the President.

Remuneration

• Emoluments and Allowances: Paid as directed by the Federal Government through the National Salaries and Wages Commission.

Functions and Powers of the Board

• Guidelines and Supervision:
• Formulate guidelines for the Agency’s functions.
• Supervise the Agency’s management and internal policies.
• Fund Management:
• Ensure accountability of the Rural Electrification Fund (REF).
• Approve criteria for disbursement and the disbursement itself.
• Policy and Project Approval:
• Approve policies and procedures for fund allocation.
• Approve establishment or reorganization of Agency units.
• Reporting:
• Submit annual reports and audited accounts to the Minister.

Secretary to the Board

• Appointment: Recommended by the Managing Director, not considered a Board member.
• Responsibilities:
  • Convening meetings.
  • Recording and maintaining minutes.
  • Managing title documents and agreements.
  • Arranging payment of fees and allowances.
  • Communicating Board decisions.

Managing Director

• Appointment: By the President on Minister’s recommendation.
• Responsibilities:
• Chief executive and accounting officer.
• Administering the Agency under Board oversight.
• Five-year term, renewable once.
• Must have senior management experience in the power sector.

Employment and Staff Management

• Staff Employment:
• Agency can employ necessary staff.
• Determine job descriptions, terms, and salaries.
• Pension Benefits:
• Service is deemed approved under the Pensions Reform Act.
• Employees entitled to pensions, gratuities, and retirement benefits.

Rural Electrification Agency (REA) Headquarters and Divisions
Headquarters and Zonal Offices

• Headquarters Location: Based in the Federal Capital Territory.
• Zonal Operational Offices: Can be set up in the six geopolitical zones or in States as approved by the Board.

Divisions at Headquarters

1. Rural Electrification Fund Division:
• Headed by an Executive Director.
• Includes the Fund Management Directorate under direct supervision.
2. Engineering and Technical Services Division:
• Headed by an Executive Director.
• Includes the Projects Support Directorate under direct supervision.
3. Corporate Services Division:
• Headed by an Executive Director.
• Includes:
• Planning, Research, and Promotion Directorate
• Finance and Administration Directorate

Qualifications and Responsibilities of Executive Directors

1. General Qualifications:
• Academic and professional qualifications in relevant fields such as power, engineering, law, accounting, corporate communication, project management, public administration.
• Relevant experience and competence.
2. Executive Director, Rural Electrification and Renewable Energy Fund Division:
• Oversee the Rural Electrification Fund Management Directorate.
• Implement Agency policies related to the Rural Electrification Fund.
• Supervise Directorate work and report to the Managing Director or the Board.
• Coordinate expenditure estimates and development plans.
3. Executive Director, Engineering and Technical Services Division:
• Head the Engineering and Technical Services Division.
• Oversee the Projects Support Directorate.
• Implement Agency policies related to rural electrification, renewable energy, and energy efficiency.
• Supervise Directorate work and report to the Managing Director or the Board.
• Ensure expenditure estimates align with Agency objectives.
4. Executive Director, Corporate Services Division:
• Head the Corporate Services Division.
• Oversee the Planning, Research, and Promotion Directorate to promote rural electrification and create awareness.
• Oversee the Finance and Administration Directorate to manage the Agency’s internal finance and administration.

Responsibilities of Directorates and Management
REF Management Directorate

• Establishment and Administration: Establish and manage the Rural Electrification Fund (REF) to provide capital subsidies to qualified rural electrification schemes.
• Policy Compliance: Ensure compliance with policy guidelines and procedures for administering the REF, focusing on transparency and accountability.
• Coordination: Coordinate rural electrification projects at local, zonal, and federal levels.
• Additional Functions: Perform any other relevant functions as approved by the Board.

Engineering and Technical Services Directorate

• Technical Support:Provide technical support for Agency projects including planning, survey, analysis, technical design, evaluations, verifications, and production of bill of engineering measurement and evaluation.
• Monitoring and Supervision: Monitor and supervise projects to ensure compliance with standards and global best practices.
• Technical Partnerships: Facilitate technical support from public and private sector partnerships.

Projects Support Directorate

• Technical Support for Schemes:Provide technical support for rural electrification schemes as per policy guidelines to protect consumers and service providers.
• Project Monitoring: Monitor and supervise project development and implementation to ensure compliance with standards and specifications.
• Safety and Quality Assurance:Ensure that projects supported by the REF meet safety standards, quality requirements, and are cost-effective.

Planning, Research and Promotion Directorate

• Promotion:Promote rural electrification throughout Nigeria.
• Information Clearinghouse: Serve as an information hub and promote public awareness.
• Data Collection: Work with the Ministry responsible for power to collect data on rural electrification, including existing and planned projects, renewable energy sources, and technological innovations.

Finance and Administration Directorate

• Financial and Administrative Management: Handle internal financial and administrative management of the Agency.
• Liaison with Zonal Offices: Coordinate with zonal offices regarding staff matters.

Rural Electrification Fund (REF)
Establishment and Funding Sources

• Sources of Funds:
• Operating surpluses of the Commission.
• Fines and penalties collected by the Commission.
• Donations, grants, gifts, assistance, or loans from various entities.
• Special intervention funds from governments.
• Endowments and bequests.
• Funds appropriated by the National Assembly.
• 2% of the Commission’s tariff structure as operational costs.

Purpose of the REF

• Equitable Access: Achieve more equitable regional access to electricity.
• Maximizing Benefits: Maximize economic, social, and environmental benefits of rural electrification subsidies.
• Grid and Off-Grid Expansion: Promote grid expansion and off-grid electrification.
• Innovation and Research: Stimulate innovative approaches and research in rural electrification and renewable energy.
• Adopt Best Practices: Implement programs adopting international best practices.
• Infrastructure Development: Develop infrastructure and capacity for renewable energy for electrification.

Management and Contributions

• Management: Managed by the Fund Management Directorate under the supervision of the Executive Director, Fund Division.
• Contribution Rates: Determined by the Commission, considering the impact on eligible customers and licensees.
• Collections and Payments: Contributions collected and paid to the REF as per procedures established by the Agency.

Disbursement of Funds

• Criteria for Allocation: Established objectively and transparently, considering financial support needs, progress in rural electrification, and local matching funding.
• Procedure: Open, competitive, and transparent procedures for disbursement, with eligibility and selection criteria.
• Eligibility and Selection Criteria: Based on technical, economic, and financial viability, support for rural development, and level of community and investor commitment.

Penalties and Application of Funds

• Penalties: Fines for non-payment of contributions.
• Application of Funds: Funds used for projects, administration, publicity, allowances, salaries, and other activities approved by the Board.

Tax Exemption

• Exemption from Income Tax: All money sources paid into the REF are exempt from income tax.

Minister’s Supervisory Powers

• Policy Responsibilities:
• Formulate, amend, and implement the National Rural Electrification Policy.
• Issue directives to the Agency for policy implementation.
• Make recommendations to the Agency on performance of its functions.
• Review the Rural Electrification Strategy and Implementation Plan every two years with the President’s approval.

Collaboration with State Boards

• Execution and Coordination:
• Collaborate with State Rural Electrification Boards or related state agencies.
• Encourage states to establish Local Government Rural Electrification Implementation Committees.
• State Legislation:
• State Houses of Assembly to make laws for the structure, operation, and functions of State Electricity Boards and Local Government Committees.

Agency Liaison and Support

• Effective Liaison:
• Work with State Boards and Local Government Committees to assess electrification status and review project progress.
• Implement awareness programs on renewable energy opportunities.
• Resolve land acquisition and access disputes for rural electrification projects.
• Advise on best strategies for achieving rural electrification goals.
• Strategic Assistance:
• Assist in formulating strategic plans for rural electrification projects.
• Provide information and advice to enhance implementation efficiency.
• Offer technical and financial assistance, including training and technology transfer, to local communities.

Monitoring and Reporting

• Progress Reports:
• Quarterly reports by the Minister and Agency to the President on the implementation of the Rural Electrification Strategy and Implementation Plans.
• Reports should cover:
• National grid expansion to rural areas.
• Development of off-grid power sources.
• Renewable energy power generation.
• Impact on economic inequalities in rural and peri-urban areas.
• Impact on the rural economy and gender inequalities.
• Achievement of strategic plan projects.

Project Monitoring Mechanisms

• Effective Monitoring:
• The Agency will provide machinery for monitoring rural electrification projects nationwide.
• Utilize geographic information systems (GIS) and geo-mapping technologies for effective project monitoring and data analysis.

Acceptance of Gifts

• Terms and Conditions:
• The Agency can accept gifts of land, money, or property under specified terms.
• Gifts inconsistent with the Agency’s functions under the Act will not be accepted.

Borrowing Powers

• Project Funding:
• With Board approval, the Agency may borrow money to execute or complete special projects.

Financial Management and Accountability

• Estimates Submission:
• Submit income and expenditure estimates to the National Assembly by 30 September annually.
• Accounts and Audits:
• Maintain proper accounts and records of transactions, assets, credits, and liabilities.
• Ensure payments and expenditures are correctly made and authorized.
• Quarterly internal audits and annual external audits.
• Auditor-General to inspect and audit accounts and records, reporting any irregularities.
• Forward audited financial statements to the Minister for National Assembly submission.
• Annual Reports:
• Submit an annual report to the Minister by 30 June, including audited accounts and auditor’s report.

Legal Protections and Indemnities

• Public Officers Protection Act:
• Apply provisions to suits against Agency officers or employees.
• 30-day notice before initiating suits.
• Execution Against the Agency:
  • No execution or attachment process without the Attorney-General’s consent.
• Indemnity:
• Indemnification of Board members and officers against civil or criminal proceedings if they are acquitted or receive favorable judgment.