The Nigerian Bulk Electricity Trading Plc (NBET) is set to exit the electricity market as the Nigerian Electricity Regulatory Commission (NERC) licences multiple firms.
The firms are to buy and sell electricity in bulk from the Power Generation Companies (GenCos).
This was contained in an order signed by the NERC Chairman, Sanusi Garba, and the Commissioner of Legal, Licencing and Compliance, Dafe Akpeneye, on Sunday, July 28, 2024.
The order stated that the directive took effect from July 25.
The order said NBET shall forthwith cease to enter into new contracts for the purchase and resale of electricity and ancillary services in the Nigerian Electricity Supply Industry (NESI).
In the new order on the Transition, NERC noted that Electricity Distribution Companies (DisCos) can now purchase electricity directly from generation companies (Gencos) without NBET acting as an intermediary.
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According to the commission, any contract executed by NBET in violation of this order shall not be approved and shall be treated as an infraction that is subject to regulatory sanction
It said: ”NBET shall in the interim, continue to administer the fully effective contracts with the five Generation Companies (GenCos): Azura Power West Africa Limited, Omotosho Power Plc, Olorunsogo Power Plc, Nigerian Agip Oil Company Limited, and Shell Petroleum Development Company of Nigeria Limited.
“Based on the minimum ‘take or pay’ capacities contained in their respective Power Purchase Agreements (PPAs).”
The NERC added that the capacity from the five plants will be vested to DisCos based on the guaranteed share of capacity contained in their respective vesting contracts.
The Electricity Power Sector Reform Act (EPSRA) created NBET to buy and sell electricity in bulk from power producers. NBET was meant to help temporarily with the sector’s financial problems.
NBET was licenced as a bulk trader by the NERC on August 23, 2011. The licence issued to the company had a tenure of 10 years and was subject to renewal as may be determined by the commission.
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