NERC approves interim rules for power firms
The Nigerian Electricity Regulatory Commission (NERC) has approved the interim rules to be in operation before declaring the Transitional Electricity Market (TEM), just as it approved the Enforcement Regulations that bounds all electricity licensees to the sector rules.
The order which was signed by the chairman and chief executive of the commission, Dr. Sam Amadi provides for regulation which shall apply to energy produced and delivered as well as associated services during the interim period.
A statement issued by the commission’s head of public affairs Dr. Abba Usman said the interim rules are intended to cover all electricity taken from the transmission system by the distribution companies with adjustment made to account for any bilateral arrangements between Generation companies (Gencos) and Distribution companies (Discos).
The objectives of the rules are to establish a framework to govern trading arrangements during the interim period when Power Purchase Agreements (PPAs) between the privatised Power Holding Company of Nigeria (PHCN) successor generation companies and Nigerian Bulk Electricity Trading Plc (NBET) and Vesting Contracts between NBET and the privatised PHCN successor distribution companies will not be effective.
It is also to manage the probable revenue shortfall in the industry by determining the revenue allowable to participants and service providers during the interim period.
In the event of disputes arising during the period between participants and service providers, it shall be resolved in accordance with the disputes resolution provision of the market rules.
Non -compliance with the decision and orders of NERC shall attract an administrative sanction and institution of civil proceedings in court against any person for the purpose of enforcing compliance.