- TCN steps up market enforcements, Kano risks eviction from grid
Chineme Okafor in Abuja
A report from the System Operations (SO) department of the Transmission Company of Nigeria (TCN) revealed Thursday that the level of electricity distribution by the 11 electricity distribution companies (Discos) in the country has significantly dropped to 2,6962.82 megawatts (MW) or 46.73 per cent.
The report, which showed the level of unutilised power generation by the Discos, explained that while the certified distribution capacity of the 11 Discos has remained at 6,235.66MW, their actual consumption has however declined to 2,962.82MW.
The report obtained by THISDAY came at a time when the TCN has raised the bar on its push to cleanse the Nigerian electricity market from recalcitrant transactional behaviours by operators in the market, mostly the Discos.
THISDAY gathered that in addition to its fine of several Discos for market transactional failures, the Market Operator (MO) department of TCN could fine another Disco – the Kaduna Disco – for alleged market infractions.
The potential sanction of Kaduna Disco by the MO coincided with the MO’s plan to withdraw power supply from the national grid to Kano Disco in about five days from today, if it fails to put up a convincing argument to stop an impending enforcement action against it.
The MO explained that Kano Disco has severally abused the transaction processes of the market and was owing it N315,805,053.49, representing 50 per cent of its May 2019 supply invoice, in addition to other market infractions.
However, the market report on the Discos’ distribution capacity stated that while they usually opted to take an average of 3,700.58MW from the national grid, they eventually take just about 2,962.82MW.
Additionally, the capacity taken by the Discos is reported to be below the daily supply volume approved in the Multi Year Tariff Order (MYTO) by the Nigerian Electricity Regulatory Commission (NERC) which is 4,654.15MW.
According to the report, for instance, on August 27, the Abuja Disco had a capacity to distribute 8,04.30MW but opted to take 3,99MW from the grid. It however ended up taking 382.18MW. The Benin Disco, which has a capacity of 530.98MW, only took 216.97MW from the grid on that day, while Eko with a distribution capacity of 745.30MW took 429.92MW.
For Enugu, which has a confirmed distribution capacity of 637.18, eventually took 252.20MW on that day; Ibadan with 758.75MW capacity took 421.99MW; Ikeja has 773.60MW distribution capacity but took 326.83MW; Jos with 355MW took 134.32MW for distribution to its customers; Kaduna which has the capacity to distribute 468.10MW only took 171.24MW to its customers; Kano with 424MW equally took only 141.51MW on that day.
The two other Discos in the market – Port Harcourt and Yola – have capacities to distribute 505.30MW and 233.15MW respectively but on August 27 took only 188.18Mw and 113.17MW respectively to their customers.
Officials in the SO department of TCN informed THISDAY that the current deterioration in power distribution has remained unchanged for a while now, adding that the Discos frequently nominated their load demands but do not take them up.
The Association of Nigerian Electricity Distributors (ANED), which is the umbrella trade union of the Discos, could not be reached for comments on this. Calls and messages sent to its Director, Research and Advocacy, Mr. Sunday Oduntan, for clarification did not get any response as at the time of filing this report.
Meanwhile, it was gathered from the MO that the Kaduna Disco could be charged by the MO for reported market infractions and have in this regard been invited to clarify its alleged market defaults.
The invitation to Kaduna Disco followed the MO’s disclosure that it would step up its punishment to Kano Disco in the next couple of days if it fails to put up an absolutely convincing case against the imminent enforcement action.
The MO said that it suspended Kano Disco through orders it recently issued for its failure to rectify two event of market defaults – lack of adequate security cover and default in payment of its May 2019 invoice.
It noted that because Kano Disco failed to rectify these charges, it was giving it until September 10 to explain why it should not be disconnected from the national grid.
“Based on Market Rules 45.4.1 and 45.4.3, the Market Operator hereby gives Kano Electricity Distribution Company (KEDCO) of this Notice of Intent to Issue a Disconnection (NIIDO) on the grounds that it has not cured the events of default which triggered Suspension Order TCN/ISO/MO/005 ( issued July 21, 2019) within 30 business days.
“KEDCO has still not topped up its security cover and has made media claims it is not going to top it up. KEDCO has not paid in full its May 2019 invoice, still owing N315,805,053.49 representing 50 per cent of the invoice. In line with Market Rules 45.4.3.b, KEDCO is required to make a written representation to the Market Operator why the termination order should not be issued by September 10, 2019,” said the MO in the notice seen by THISDAY.