The National Energy Fund was established in 1990, by the Petroleum Products and Energy Act of 1990, Section 11, Subsection 1and 2, as amended in 2003. NEF receives monies being Petroleum Equalization levy, collected in respect of levies imposed on controlled petroleum products consumed in the country. The Fund also collect money on behalf of the Motor Vehicle Accident (MVA) Fund and Road Safety Secretariat (RSS) and remits it to the respective institutions. NEF also receive money collected by Nampower for the electricity levy.

The NEF administers the "Slate Account" which is an account between the State and the Suppliers of petroleum products. The purpose of this account is to make payment of under recoveries to suppliers of petroleum products and receipt of over-recoveries from suppliers of petroleum products caused by the international oil prices and the exchange rate fluctuation among other factors in relation to fixed local pump prices.
The functions of the NEF are as follows:

• To pay for the Fuel Road Delivery Subsidy claims to the rural/far outlying areas of the country;
• To pay for the research undertaken in connection with the development of any form of energy;
• To be used by any competent institution of the state, or any person or body which is involved in any activities connected with the purchase , acquisition, sale , saving, conservation, storage or utilization of energy sources;
• To be used to improve the quality of energy supply and services;
• To provide funding for renewable Energy Projects;
• To provide funding to Regional Electricity Distributors (REDs) through soft loans for energy related projects;
• To subsidize electricity pricing of identified poor communities;
• To subsidize electricity tariff to avoid temporary price shocks