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Nigeria’s Electricity Regulator Orders Cap on Power Supply to Benin, Niger, and Togo to Boost Availability in Nigeria 

NERC’s interim cap order on international customer capacities for six months aim to minimise impacts on domestic Gencos’ supply obligations.

The Nigerian Electricity Regulatory Commission (NERC) has ordered the System Operator (SO), a department in the Transmission Company of Nigeria (TCN) to commence the capping of power supply to cross-border customers in Benin Republic, Niger and Togo, in a bid to increase power availability to Nigerians.

This is coming as the Minister of Power, Chief Adebayo Adelabu has disclosed that the federal government and the Nigerian Sovereign Investment Authority (NSIA) will make capital injections of N750 billion and N250 billion annual debt financing, respectively, to bridge the huge electricity metering gap in the country that currently stands at about seven million.

In a document tagged: ‘Interim Order on Transmission System Dispatch Operations, Cross-border Supply and Related Matters’, sighted on Saturday, the power sector regulator stated that the directive will last for six months in the first instance before review.

Nigeria supplies a portion of the electricity it generates to some of its neighbours, including the Benin Republic, Niger Republic, and Togo.

NERC’s order, dated April 29, 2024, and which became effective from May 1, 2024, was signed by the commission’s Chairman, Sanusi Garba, and Vice Chairman, Musiliu Oseni and

In the order, the regulatory agency directed that power delivery to Nigeria’s neighbours must not exceed six per cent of total grid electricity at any point in time.The electricity sector regulator stressed that following the implementation of the April 2024 supplementary order, the commission had observed sub-optimal grid dispatch operation practices.

It argued that this has compromised the Distribution Companies’ (Discos) ability to deliver on its Service Based Tariff (SBT) committed service levels to end-use customers with a significant impact on market revenues.

NERC said the system operator’s sole reliance on limiting Discos’ load off-take/allocation in managing recurring grid imbalances while prioritising international off-takers and Eligible Customers (ECs) is neither efficient nor equitable.

The practice so far adopted by the operator in managing generation availability, it said, has caused significant hardship to Discos’ customers, comprising industrial, commercial, and residential, especially during peak demands while prioritising delivery to other bilateral contracts, including export to international customers.

The commission noted that the current international and bilateral contracts with Generation Companies (Gencos) were based on best-endeavour and with loose terms that are often below the minimum contract standards currently operated in the industry.

It said many of the off-takers contracted bilaterally by Gencos often abuse this prioritisation and raise their off-takers during peak operations beyond their contracted levels at the expense of other grid users without attendant penalties for violation of grid instructions.

According to NERC, the order serves as an interim measure to guide the operations of the system operator and the TCN to implement Standard Operating Procedures (SOPs) to improve transparency and fairness of grid operations in delivering better services to all customers.

It urged the system operator to place interim caps on capacities supplied to international customers for six months from the effective date of the order, thus minimising the displacement and impact on domestic supply obligations by Gencos.

“The commission hereby orders as follows: The system operator shall develop and present to the commission for approval within seven days from the issuance of this order a pro-rata load-shedding scheme that ensures equitable adjustment to load allocation to all off-takers — Discos, international customers, and eligible customers — in the event of a drop in generation and other under-frequency related grid imbalances necessitating critical grid management.

“The system operator shall implement a framework to log and publish hourly readings and enforce necessary sanctions for violation of grid instructions and contracted nominations by off-takers in line with the grid code and market,” it stated.

Among others, it further directed that the system operator shall publish and notify all market participants and the commission of the previous day’s hourly log readings of off-take by market participants and the market settlements report by 12:00 noon of the next day.

“The system operator shall ensure that the maximum load allocation to international off-takers in each trading hour shall not be more than six per cent of the total available grid generation.

“The aggregate capacity that can be nominated by a generating plant to service international off-takers shall not be more than 10 per cent of its available generation capacity unless in exceptional circumstances a derogation is granted by the commission.

“The system operator shall henceforth cease to recognise any capacity addition in bilateral transactions between a generator and an off-taker without the express approval of the commission,” it added.

It urged the system operator and TCN to immediately initiate and install integrated Internet of Things (IoT) meters at all off-take and delivery points of eligible customers, bilateral supplies, cross-border trades, and outgoing 33kV feeders of the Discos to provide real-time visibility of aggregate offtake by grid customers.

“The installation of and streaming of data from the IOT meters should be completed within three months from the date of this order,” it added.

FG, NSIA to Inject N1trn to Close Seven Million Electricity Metering Gap

Meanwhile, the Minister of Power, Adelabu has disclosed that the federal government and the NSIA will make capital injections of N750 billion and N250 billion annual debt financing, respectively, to bridge the huge electricity metering gap in the country.

Speaking on Saturday in Lagos when he visited Femadec Group, a local electricity meter manufacturing company, shortly after he had earlier in the day inaugurated the 63MVA, 132/33kV Mobile Substation deployed to Ajah under the Phase One of the Presidential Power Initiative (PPI), the minister stated that the federal government has a strategic approach to close the metering gap.

 He noted that there are close to 13 million registered electricity consumers currently, with a little over five million metered customers, representing about a seven million gap in metering penetration.

Adelabu stated that there had been a series of accelerated meter acquisition plans in the past including the Central Bank of Nigeria (CBN)’s Phase Zero, where about one million households were metered.

 “The target that we have is that within four to five years, we should close the gap, which means that a minimum of two million meters must be installed under the Presidential Metering Initiatives every year. 

“So, this is going to be funded by a mix of equity capital and debt funding. The government is going to make available seed capital of about N750 billion and there will be debt funding by some financial institutions, starting with Nigerian Sovereign Wealth Investment Authority (NSIA) which will be providing nothing less than N250 billion every year to enable us to fund the meter acquisition plan”.

Meanwhile, at the inauguration event in Ajah, the minister informed that Nigeria’s current power generation had in the past few days increased to 4,800 megawatts (MW) from 4,200MW, owing to the commencement of operation by the Zungeru Hydro Electric Power Plant in Niger State.

The minister also disclosed that the recent increment in Band A customer’s tariff had also led to the renewed interest of investors as well as financial institutions in the power sector.

TCN Announces Planned Outage on Benin-Delta Double Circuit Lines

Meanwhile, TCN has stated that it will commence the erection of two 132kV transmission towers at its Amukpe transmission substation and will restore a portion of the Benin-Delta and Delta-Oghara 132kV double circuit transmission lines, from May 4 to 17, 2024.

A statement issued by Saturday by its General Manager, Public Affairs, Ndidi Mbah, noted that consequently, Amukpe substation would be out for the duration of the work.

Also, it said the bulk power supply to Benin Disco through Adeje, Industrial, Woodland, Mosogar, Sapele, and Abraka feeders will be out of bulk power supply for the period.

Emmanuel Addeh and Peter Uzoho

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