FG Disconnects Power Firms From National Grid For Not Following Electricity Market Rules

Federal Government announced that they have disconnected some of the power firms from the national grid for not following the Electricity Market Rules.

"Some of these rules are domiciled with the Market Operator, but today, adherence to the Market Rule is below expectation," Federal Government's Transmission Company of Nigeria, Dr. Edmund Eje said in Abuja, Punch reported.

He noted that the Nigerian Electricity Supply Industry(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," Eje continued. "If the rules of every game are observed, there would be no need for sanctions."

Transmission Company of Nigeria (TCN) disclosed that they have been sanctioning erring market participants and giving 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 added.

He explained that some of the sanctioned power firms will attempt to make this action a political issue and urged people to be mindful to understand the real issues.

Eje explained the government's procedure before disconnecting a power firm in the market. He shared that government first sends a notification of non-compliance when the participant violated the market rules or failed to make the payment 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," he explained. "This notice will specify the reasons for the intended suspension, the proposed duration of the suspension, and the conditions for lifting the suspension."

The power firm is also given a chance to respond to the notice, where it can explain why the suspension should not be imposed. However, if the firm fails to do so, then a notice of suspension is sent.

"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 added.

"After the suspension period, the participant may apply for reinstatement by providing evidence of compliance with the market rules and any other conditions specified in the 'Notice of Suspension'," he concluded. "The MO will review the application and make a determination on whether to lift the suspension or not."

TCN has not disclosed the names of power firms that were removed from the national grid yet.