The Nigerian Independent System Operator (NISO) has rejected payment proposals submitted by some electricity distribution companies (DisCos) to settle their outstanding obligations to the Nigerian Electricity Market and service providers.
The management of NISO disclosed this in a statement issued in Abuja on Sunday.
NISO said the proposals were considered unacceptable, particularly given the magnitude and age of the outstanding debts, following a four-day public hearing with the affected DisCos in Abuja.
The hearing, which began on September 1 and ended on September 4, was convened to review the distribution companies’ outstanding market obligations and examine their proposed arrangements for settling the debts.
It was conducted by a five-member committee chaired by NISO’s Executive Director, Market Operations, Mr Edmund Eje.
The committee also expressed concern over the payment frameworks proposed by some of the DisCos, describing them as inadequate to address their outstanding market obligations.
According to NISO, the Federal Government has already netted off about 97 percent of the DisCos’ outstanding obligations incurred between 2015 and 2020.
The system operator said the committee stressed the need for the affected DisCos to take immediate steps to clear their remaining balances.
NISO said it would proceed with the next stage of the process, including the application of sanctions provided under the Market Rules.
It, however, reaffirmed its commitment to constructive engagement, transparency and due process in resolving the outstanding obligations.
READ ALSO: NANS Demands Stronger Action as Fake Drugs and Unsafe Food Spread
The system operator said the hearing also provided an opportunity to examine the DisCos’ proposals for liquidating debts that have continued to affect the effective functioning and development of the Nigerian Electricity Market.
NISO said the hearing highlighted growing concerns about market discipline and the failure of some participants in the electricity market to meet their financial obligations.
It said the situation had continued to affect service providers and undermine the sustainability of the power sector.
The system operator stressed that stronger compliance and accountability among market participants were critical to restoring confidence and ensuring the effective and sustainable operation of the Nigerian electricity market.
