The Nigerian Electricity Regulatory Commission (NERC) has initiated a significant restructuring within the country’s power sector by unbundling the Transmission Company of Nigeria (TCN).
In a circular dated April 30, 2023, jointly signed by NERC’s Chairman, Sanusi Garba, and Vice Chairman, Musiliu Oseni, the commission outlined the establishment of the Nigerian Independent System Operator of Nigeria Limited (NISO).
This move follows the directives of the Electricity Act 2023, which came into effect on June 9, providing clearer guidelines for the incorporation and licensing of the independent system operator (ISO), as well as the transfer of assets and liabilities of TCN’s portion of the ISO.
As per the circular, TCN is mandated to transfer all market and system operation functions to the newly formed NISO.
The Bureau of Public Enterprises (BPE) has been instructed to incorporate, by May 31, a private company limited by shares under the Companies and Allied Matters Act (CAMA), 2020, named the Nigerian Independent System Operator of Nigeria Limited (NISO).
It said: “The name of the company shall, subject to availability at Corporate Affairs Commission, be the Nigerian Independent System Operator of Nigeria Limited (NISO).
“Citing the object clause of the NISO’s memorandum of association (MOU) as provided in the Electricity Act, NERC said the company shall “hold and manage all assets and liabilities pertaining to market and system operation on behalf of market participants and consumer groups or such stakeholders as the Commission may specify.”
The responsibilities of NISO, outlined by NERC, include holding and managing all assets and liabilities related to market and system operation on behalf of market participants and consumer groups, as specified in the Electricity Act.
Additionally, NISO will negotiate and contract for ancillary services with independent power producers and successor generation licensees.
NERC emphasized that the establishment of NISO aims to streamline market and system operations functions, ensuring efficiency and adherence to regulatory guidelines.
The new company is tasked with upholding contractual rights and obligations handed over by TCN, while prioritizing the interests of market participants and system users.
