The Market Operator, an arm of the Federal Government’s Transmission Company of Nigeria, Dr. Edmund Eje, on Tuesday revealed that some power companies would be disconnected from the national grid for violating certain rules governing the sector.
According to Eje, these power companies have repeatedly refused to adhere to the Electricity Market Rules.
The government explained that the Nigerian electricity supply industry was governed by laws, which were critically required for the viability and sustainability of the sector, but it avoided naming the affected power facilities.
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The Federal Government claimed that these regulations were inviolate and that any new or existing actors in the industry had to abide by them.
According to the government, the rules must be followed and upheld in order for all participants to properly interact and establish the harmony necessary for the sector’s growth, efficiency, and profitability.
Eje stated, “Some of these rules are domiciled with the Market Operator, but today, adherence to the Market Rule is below expectation.
“NESI market indiscipline is one of the major factors dealing a disastrous blow to the scalability and growth of the market.
“Market Participation Agreement is signed by all participants, but to comply with them is usually an uphill task for many. If the rules of every game are observed, there would be no need for sanctions.
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“Currently, the Market Operator – TCN, is embarking on sanctioning erring market participants, having given them notices and time to comply with the market rules. One of the fallouts of the sanctions will be the partial or complete disconnection of defaulters from their point of connection to the grid.”
Eje said it was understandable that some of the players who had been punished could try to politicise the situation in order to garner quick points and inflame unwarranted feelings, but he advised against ignoring the main concerns, which were the effectiveness and continued existence of the NESI.
He clarified the steps the government takes through TCN before suspending or disconnecting a power firm from the market in order to ensure clarity.
He stated that notifications of non-compliance would be sent out in order of when a participant broke market regulations or failed to pay sums owed to the Market Operator.
“Notice of intention to suspend is then sent. If the participant fails to comply with the notice, the Market Operator may issue a notice of intention to suspend a participant’s access to the market.
“Then the notice of suspension would follow. Here, if the participant still fails to comply with the ‘Notice of Intention to Suspend’, the Market Operator may issue a ‘Notice of Suspension’, which may last for 30 business days after which the MO can escalate the suspension to the Commission for the Business Continuity Regulation to click in,” Eje explained.