The Nigerian Electricity Regulatory Commission (NERC) has initiated the unbundling process of the Transmission Company of Nigeria (TCN) by introducing the Nigerian Independent System Operator of Nigeria Limited (NISO).
According to an Order dated April 30, 2023, signed by NERC Chairman Sanusi Garba and Vice Chairman Musiliu Oseni, TCN is required to transfer all market and system operation functions to the newly established entity.
Previously, TCN held licenses for transmission service provider (TSP) and system operations (SO) in accordance with the Electric Power Sector Reform Act.
However, the enactment of the Electricity Act 2023 provided clearer guidelines for incorporating and licensing the independent system operator (ISO) and for the transfer of assets and liabilities from TCN to the ISO.
In compliance with this directive, NERC has directed the Bureau of Public Enterprises (BPE) to incorporate a private company limited by shares under the Companies and Allied Matters Act (CAMA), 2020, by May 31.
This new entity, named the Nigerian Independent System Operator of Nigeria Limited (“NISO”), will take over the market and system operation functions outlined in the Electricity Act and TCN’s system operation license terms.
NERC emphasized that NISO’s memorandum of association (MOU) will authorize the company to manage all assets and liabilities related to market and system operation on behalf of market participants, consumer groups, or specified stakeholders.
Additionally, NISO will be responsible for negotiating ancillary service procurement contracts with independent power producers and successor generation licensees, as well as performing other market and system operation functions outlined in its license.