A blackout is looming in FCT and others as TCN suspends AEDC for non-compliance with market rules

The Market Operator (MO) of the Transmission Company of Nigeria (TCN) has suspended the Abuja Electricity Distribution Company (AEDC) for failing to comply with market rules.

Mr Ali Ahmad, a market operator at TCN, said in Abuja on Friday that the suspension notice was communicated to AEDC after previously notifying it in writing of its failure to comply with market rules.

Ahmad said AEDC also failed to provide the MO with an adequate bank guarantee as required by section 15.3.3 of the market rules.

He said AEDC received several notifications, including a Prudential Requirement Compliance Request on February 13 and a Notice of Non-Compliance Event: Prudential Requirement Failure on March 22, but none were acted upon.

According to him, on April 8, AEDC was subsequently sent a Notice of Intent to Issue a Suspension Order: Failure to Provide Adequate Bank Security.

“In these notices, the MO requested that corrective action be taken within a specific period to address the non-compliance.

“Despite all notifications, AEDC has not solved the problem. In view of this non-compliance, AEDC is suspended from the electricity market administered by MO.” he said.

He said that to remedy the situation, AEDC must provide an adequate Bank Guarantee within five business days from the date of this notice.

AEDC will disconnect from the national grid

Additionally, residents of the Federal Capital Territory, as well as Niger, Kogi and Nasarawa states, may face power outages starting July 28, 2024, as the TCN said it will disconnect AEDC partially or permanently from the national grid if it fails to recover.

He mentioned that the AEDC network could face partial or complete grid disconnection if the problem is not resolved within five business days, as specified in section 45 of the market rules.

TCN announced July 28, 2024 as the disconnection date, adding that the disconnection points will include: the 33 Kv feeder of the 132/33 Kv Katampe 1 Transmission Station and the 33 Kv feeder of the 132/33 Kv Central Area Transmission Station.

“The non-compliant Market Participant AEDC has been duly notified of its violations related to the non-compliance with section 15.3.3.a of the Market Rules. The publication in the newspaper has been made in accordance with the Market Rules, which grant AEDC a period of five (5) business days from the date of this publication to remedy its violations of the market rules.

“In addition, after 30 business days from the disconnection of the network and without addressing the non-compliance, the Market Operator will terminate the AEDC Market Participation Agreement,” he added.

What you should know

Nigerian electricity distribution companies (DisCos) have continuously faced various sanctions from regulators due to non-compliance with industry standards.

These penalties arise from multiple issues, including overbilling to unmetered customers and violation of Nigerian Electricity Regulatory Commission (NERC) regulations.

Regulatory bodies have been diligent in monitoring and enforcing regulations to ensure fair practices within the industry.

Recently, the Abuja Electricity Distribution Company (AEDC) was fined N200 million for overbilling Band A customers.

This penalty reflects the seriousness with which NERC views these violations and its commitment to protecting consumer rights.

The fine serves as a warning to other DisCos to adhere to fair billing practices and regulatory requirements.

These measures are part of a broader effort to rein in DiscCos and prevent them from defrauding customers.

By imposing fines and penalties, NERC and other regulators seek to create a more transparent and accountable electricity distribution system.