By Chris Ochayi

After being postponed for a number of times, the Federal Government has indicated strong readiness to declare the commencement of the Transitional Electricity Market, TEM.

The TEM, was initially slated to commence last year, but postponed to March 1, 2014 due to failure to meet certain conditions.

The Chairman of the Nigerian Electricity Regulatory Commission, NERC, Dr. Sam Amadi, disclosed this in Abuja. He said, “We have completed the last of the formal condition precedents, CPs, and we are effectively handling the informal CPs. NERC is poised to recommend to the Minister of Power to declare the commencement of the TEM at a named date.”

Below are some of the conditions, which are expected to be met between the completion of the privatisation process and the start of TEM. They include the execution of the market participation agreement; market operations system regulations, market settlement system; and the procedures for registration and admission processes for market participants.

As a result, the Federal Government, on March 17, suspended indefinitely the planned implementation of the TEM, saying it was more concerned about putting the right market conditions in place for the sector to thrive.

However, the Minister of Power, Prof. Chinedu Nebo, had recently blamed the new owners of the distribution companies, Discos, for the delay in the declaration of the TEM.

He said the DISCOs needed to be reassured of their ability to recoup their investments, especially through revenue collection.

But speaking during the inauguration of members of the Dispute Resolution Panel, DRP, Amadi declared that the TEM is now ready for commencement.

“By today’s event, we have met the last condition precedent for the commencement of the TEM as prescribed by the Market Rules,” he said.

The NERC, in 2011, established an industry wide Transition Steering Group, TSG, to manage the efforts of stakeholders in the electricity industry to achieve the CPs for the commencement of the TEM.

Amadi also identified some informal CPs that were not listed in the Market Rules, but are necessary for the optimal working of the market.

He said, “For this stage of the market, certain formal and informal CPs need to be met. The formal CPs include: the approval of grid codes and market rules, the establishment of an independent regulator, the establishment of market operation and system operation with functional capabilitiesm, and the establishment of a market dispute resolution mechanism.