NERC threatens to sanction TCN, MO for operating illegal bank account

The Nigerian Electricity Regulatory Commission (NERC) on Monday issued sanction threats to the Market Operator (MO), a unit of the Transmission Company of Nigeria (TCN), for keeping and operating an illegal unilateral bank account, serving on them what it called “notices of commencement of enforcement action.”

The notice gave the erring MO seven days ultimatum to take remedial actions by winding down its operations of the unilateral bank account and reporting compliance, without which disciplinary action would be carried out by the Commission. However, the erring parties have not yet taken the regulator’s directives.

At the dusk of the immediate past administration of Goodluck Jonathan, the Federal Government appointed some MO staff as a separate management team, followed by TCN’s removal of their names from its payroll.

This prompted the opening of a separate bank account by the Market Operator, which partly manages cash flow in the electricity market.

In separate notices signed by the deputy general manager, enforcement unit, NERC, Chijioke Obi, the Commission said their continued actions were contrary to Section 63(1) of the Electric Power Sector Reform (EPSR) Act (2005).

The Act stipulates that “a licensee shall comply with the provisions of his licence, regulations, codes, and other requirements issued by the Commission from time to time.”

They were also reminded of Section 3(1) of the licence conditions, which stipulates, “licensee shall comply with any orders, directions and determinations made by the Commission pursuant to the Act…”

Following this, TCN was directed to “put the appointed/elevated staff back onto its payroll and on levels that match their present status in the interim until counter presidential directive is made.”

The Market Operator was also directed to “immediately close its subsidiary account, restore the original account to the normal condition of consensual approval and inform the Commission accordingly, and that the Market Operator should continue funding the System Operator with the previously designated amount as paid other market participants.”

MO is a division of the Transmission Company of Nigeria (TCN) that issues market settlements and invoices due to market participants and service providers in the Nigerian Electricity Supply Industry (NESI). TCN, which is currently under a management contract being executed by Manitoba Hydro of Canada, is a licensee of NERC.

TCN’s licence and statutory duties empower it to manage the MO and the System Operator (SO), which is responsible for electricity evacuation from power stations to electricity distribution companies.