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NERC To Unbundle TCN

Federal government has declared plans for stakeholder engagements to map out plans for unbundling of the Transmission Company of Nigeria (TCN) and create alternative channel for evacuation of volume generation from remote power plants to load centers across the country.

Nigerian Electricity Regulatory Commission (NERC) said the move to create two entities from the central grip operators was part of efforts to boost the capacity of transmission infrastructure in the industry.

NERC stated that it was set to consult the public before it would approve a proposal to create the independent system operator (ISO) from the Transmission Company of Nigeria (TCN), and renaming TCN as the Transmission Service Provider (TSP).

Chairman of NERC, Dr. Sam Amadi, had earlier in April constituted teams that understudied other countries and determined the best model to be adopted.

Speaking at that time, Amadi said that, “we have already secured a technical paper on this and the Commission has asked its internal technical committee to undergo comparative jurisdictional research to compare models from similar and different electricity markets across the world. After the report of the committee we will conduct public consultation to ascertain the views of other stakeholders.”

On the structure of TCN successor- companies, Amadi stressed that “Our mind is moving towards having a non-profit ISO to be jointly owned and funded by all generators and distributors in the market. This saves government from using its public sector borrowing or budget to fund expansion in transmission services. Everything will be financed by the market and there will still be no service failure.

“That is one of the benefits of some of NERC’s bold interventions. They are creating financial viability and service improvement with less and less of public sector financing. This is a huge relief in these days of lean revenue.”

In a notice recently sent out by NERC, the Commission said it will also be considering inputs from the consumer public by June 2, on the limit distribution companies (DISCOs) are allowed to charge consumers as estimated bills till when they are metered.

TCN is to unbundle but officials in both TCN and the Federal Ministry of Power had dismissed the issue as rumour.

When the process is completed, two distinct companies, a Transmission Service Provider (TSP) and an Independent System Operator (ISO) would have been created out of the present TCN, NERC said.

A former executive director of the Market Operator (MO) under the TCN’s Manitoba Hydro International contract had said that the MO and the System Operator were to merge and become independent this year in the unbundling blueprint during the Transition Electricity Market (TEM).

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