TCN Revokes Non-performing Transmission Contracts, Secures Spinning Reserve
The Transmission Company of Nigeria (TCN) has cancelled a couple of transmission network expansion contracts because firms contracted to execute them failed to live up to their obligations, its Managing Director, Mr. Usman Mohammed has disclosed.
Mohammed also stated that the TCN was about to procure up to 300 megawatts (MW) of electricity from power generation companies (Gencos) to serve as spinning reserves in case of collapse of the national grid.
He made these disclosures recently in Abuja, where he equally disclosed that the TCN was heavily underfunded and had asked for an extra-ordinary tariff review from the Nigerian Electricity Regulatory Commission (NERC).
Mohammed’s assertions however coincided with the decision of the TCN Chapter of the Senior Staff Association of Electricity and Allied Companies (SSAEAC) to cut off ties with its national body because of alleged false misrepresentation of facts by its national body.
But speaking in an interview with THISDAY on the status of contracts awarded by the TCN as well as the whereabouts of containers of transmission equipment it had recovered, Mohammed said, “All the contracts that are issued here are supply and installations. We have transported all the recovered transformers we recovered to their destination sites because it would be senseless to transport them to the store and then move them to the sites.
“It makes sense to send them straight to their destinations. I have cancelled so many contracts - Damaturu, Walalanbe, Wudil, Dambatta, Yawuri and a lot of others, because they (contractors) were not performing and I don’t see why they should still hold on to the contracts,” Mohammed added, and claimed the TCN had been a cash-cow to elites of the country, and who he said had been against its adoption of strict corporate governance business practice.
Asked to explain what he meant by that, he stated, “Some Nigerians make this place their farm. They get people who are doing procurement for them, and continue to collect money, but we cannot have stable power with such arrangement.”
He gave reasons why the TCN applied for an extraordinary tariff review from the NERC as well as the procurement of a spinning reserve.
According to him, “We actually made a case for extraordinary tariff review because we met NERC last year and presented our case. Our numbers showed clearly that TCN is underfunded, and NERC agreed that we need an extraordinary tariff review.
“We submitted the case,
they asked us questions and we answered but when we expected a reply from them they said they wanted to get a regulatory assets consultant and so we are waiting for that to be recruited to review our assets and give us cost reflective tariff.
“But, you must understand that in the market, the biggest problem is not only tariff, we also have liquidity problem. The liquidity problem is what we are waiting for the government to solve, he explained while noting, “It is 300MW that we are hoping to procure for the spinning reserve.”
Meanwhile, members of the TCN branch of SSAEAC have dissociated themselves from the national body of the SSAEAC as a result of, “unjustifiable rumours peddled by the national union.”