There is one effective bullet against what is known as 'agency problem' and for effective regulation of corporate governance rules the law must take the central role.
Since 2000 Nigeria commenced a reform of its electricity industry. The context and policy thrusts of that reform are captured in the National Electric Power Policy (NEPP) issued by the National Council on Privatization (NCP). The policy unbundled sectors and establishes a regulator with mandate to create and nurture a competitive electricity market. The provisions of the NEPP have been legalized by the Electric Power Sector Reform Act 2005. The Roadmap on power attempts to achieve the policy thrusts of the EPSR Act.
The Case for Transformation:
The need for transformation of the electricity industry is evident. By the late 1980s the system collapsed. Resuscitating the sector required a complete and radical reengineering of the entire industry. The character of the reengineering should match the diagnosis of the crisis. The architects of the 2000 NEPP seem to fully understand that the crisis of the electricity industry in Nigeria was not a result of a technical failure. It was much more than technical failure. The crisis was a result of governance failure hence the prescriptions zeroed on restructuring the governance architecture of the electricity industry.
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