The postponement, the Nigerian Bank Electricity Trading (NBET), which will over see TEM, said was to ensure that certain things were put in place.
These include the coming on stream of the generation companies (GENCOs and distribution companies (DISCOs).
TEM is where energy was sold and bought based on agreements among stakeholders. In the market, NBET will purchases electricity from the GENCOs/Independent Power Projects (IPPs) through Power Purchase Agreements (PPAs) and sell to the DISCOs through Vesting Contracts (VCs).
The market allows DISCOs and GENCOs to enter into agreement on how to buy electricity without going through NBET.
The country is set to operate an interim market rule which will be preceded by TEM, after a declaration from the Minister of Power, Prof Chinedu Nebo.
NBET’s Head, Power Procurement and Power Contracts,Yesufu Alonge told The Nation that stakeholders are to register with the market operator for easy administration, meet their contract obligations and pay administrative charges to the service providers as when due, among others.
Longe said the arrangement would help in providing efficient, transparent and non-discriminatory services to the participants needed to sustain the growth of the market.
He said: ‘’At present, the market is in the pre-transitional stage, progressing towards the TEM. This can only be achieved after the required conditions have been met and the Minister of Power has been advised by the Nigerian Electricity Regulatory Commission (NERC) to declare its commencement. With TEM in place in 2014, a platform where energy will be sold and bought would have been created for the sector’s growth.’’
He said NBET was required to perform its roles as the buyer and seller of electricity to foster growth, adding that parties involved in the purchase and sale of electricity are required to meet their own obligations.
“NBET is obliged to make payment to the power generation companies after buying electricity from them. Also, the power distribution companies must meet their own obligations of providing power to the consumers. It is not a one-way thing. Each of the parties is compelled to fulfill its own side of the transaction, ‘’ he said.
According to him, NBET has been capitalised with N50 billion to meet its operational needs. The money, Longe said, would be deployed in meeting NBET’s obligations whenever there is a delay in payment from the DISCOs.
Also, the Chairman, Presidential Task Force on Power, Becks Dagogo Jack, said the desire of stakeholders is to have a virile electricity market.
Jack said NERC is coming with an interim market rules, adding that operators would test and adjust them to ensure perfection when operational. The government, Jack said, is committed to providing a strong and enduring power sector reforms for growth.
The Secretary of NERC, Mrs Ada Ozemenan, explained at the StageWorld Power Conference in Lagos, that NERC, GENCOs, DISCOs and other operators have discussed about the responsibilities that would come with the operations of the Transitional Electricity Market in 2014, saying the responsibilities are enormous, but they would help in determining the direction which the sector is taking in the next few years.
According to her, the issue of providing efficient electricity market is of huge importance to NERC, NBET and the Ministry of Power.
The Federal Government had in 2005 initiated reforms of the power sector. However, it was not until 2010 when the government came out with a blueprint on the reforms. This has resulted in the privitisation of the sector, unbundling of the Power Holding Company of Nigeria(PHCN), the opening of bids for investors, the selection of companies that won the bids, and the handing over of PHCN’s assets to the investors.