New electricity tariff expected to attract N1.36tr investments in 5 yrs

The new multi-year tariff order may raise the country’s yearly investment profile by N1.36 trillion over the next five years.

Specifically, capital expenditure included in the Transmission Use of System (TUOS) are N206.212 billion in 2016; N418.504 billion in 2017; N265.203 billion in 2018; N247.828 billion in 2019 and N224.395 billion in 2020. This information was contained in the multi year tariff order for the Transmission Company of Nigeria (TCN) for the period of January 1, 2016 to December 31, 2020 released by the Nigerian Electricity Regulatory Commission (NERC).
According to the document, the cost of capital included in the MYTO is intended to provide a return on existing assets and appropriate incentives for future investment. It noted that the cost of capital is an important component of the tariff and has been included in the yearly revenue requirement calculation as a return on the value of capital invested.