GenCos React to TCN’s Claim on False Capacity Declarations

Electricity Generating Companies (GenCos) in the country have provided clarifications on the allegation by the Transmission Company of Nigeria (TCN) that GenCos were making false capacity declaration for financial claims.

The group’s umbrella body, the Association of Power Generation Companies (APGC), described the allegation as malicious, baseless, and an exhibition of ignorance of the electricity market proceedings.

The APGC in a statement by its Executive Secretary, Joy Ogaji, strongly disputed the allegation by TCN

Ogaji said GenCos were not currently paid on capacity declaration but only on delivered capacity.

She noted that delivered capacity, in this regard, meant converting metered energy to capacity, a practice which, he said, was unknown or practised by any electricity market in the world.

APGC was reacting to TCN’s alleged claim that most power plants submitted generation capacities they were unable to deliver when its subsidiary, the National Control Centre (NCC), made the demand.

“The NCC operates strictly in line with the grid code and merit order.

“Stability of the national grid is paramount. Unfortunately, many GENCOs, due to greed, destabilise the grid through illegal practices in order to collect more money from NBET.

“They do so through false capacity declarations, unwillingness to put their generators on effective frequency response, delay in executing NCC dispatch instructions, intimidation and blackmail of NCC operatives,” the TCN had said in a statement by its Spokesperson, Ndidi Mbah.

But, clarifying the matter, Ogaji said that capacities declared by the GenCos were confirmed by the Power National Control Centre (NCC) before allocating same to the Discos and would not allocate what was not available.

“GenCos have available capacity well above what the transmission grid can evacuate and the question is, why is the national grid that has a capacity of about 12,000MW not able to evacuate 7,500MW?

“Can the DisCos alleged load dropping account for TCN’s inability to evacuate the GenCos available capacity?

“It is obvious that the grid constraints and inefficient grid administration are reasons why NCC forces GenCos to ramp down on their production without taking responsibility for the associated deemed capacity payments,” said the Executive Secretary.

According to her, it was difficult to make a distinction between the alleged DisCos load dropping and Transmission inefficiency – which, of late, had culminated in the serial burning of power transformers across the grid.

She further noted that because the grid could not evacuate GenCos available capacity, the NCC dictated what the grid could carry.

“No GenCo can declare the capacity it does not have, because the NCC uses SCADA and other electronic means to confirm every GenCos declared capacity.

“Therefore, it takes ignorance of the market flow to make such a frivolous allegation that GenCos declare false capacity which they cannot make available on demand.

“In addition to the NCC’s capacity monitor, the Nigerian Bulk Electricity Trader (NBET), as well as the Independent System Operator (ISO) periodically send their teams to carry out capacity test on all GenCos to re-confirm NCC’s capacity data,” she added.

Faulting TCN’s claims, the APGC boss said in a regulated electricity market such as Nigeria’s, operators and market participants were bound by regulations and rules and not frivolity as portended by TCN.

She further stated that since TCN, through its subsidiary, the NCC, is the source of all power sector data, as they relate to power generation, transmission, distribution and consumption/demand forecast, the allegation of falsified capacity declaration was worrisome.

This allegation, she pointed out, was indicting not just the current administration’s efforts to increase power generation in the country, but also efforts by all players in the value chain, as they were being portrayed as relying on fraudulent data.