The Nigerian Electricity Regulatory Commission (NERC) has taken a significant step towards reforming the country’s power sector by unbundling the Transmission Company of Nigeria (TCN) and establishing a new independent system operator, the Independent System Operator of Nigeria Limited (NISO). This move is aimed at promoting efficiency and competition in the sector.
According to an order issued by NERC on April 30, 2023, TCN is required to transfer all market and system operation functions to NISO, which will be responsible for managing the country’s power grid and ensuring a stable supply of electricity.
The new company will also be responsible for negotiating contracts with independent power producers and successor generation licensees for the procurement of ancillary services.
The establishment of NISO is in line with the provisions of the Electricity Act 2023, which came into effect on June 9, 2023. The Act provides for the incorporation and licensing of an independent system operator, as well as the transfer of assets and liabilities of TCN’s portion of the ISO.
NERC has directed the Bureau of Public Enterprises (BPE) to incorporate NISO as a private company limited by shares on or before May 31, 2023.
The company will be responsible for carrying out market and system operation functions on behalf of market participants and consumer groups, and will be subject to the terms and conditions of its license.
