By the Multi-Year Tariff Order 2 (MYTO 2), the Nigerian Electricity Regulatory Commission (NERC) establishes the regulated prices to be paid to licensed electricity generation companies in providing electricity to distribution and retailing companies for the period 1st June, 2012 to 31st May, 2017, pursuant to the authority given under the Electric Power Sector Reform Act 2005 (the Act).
These retail tariff schedules will be reviewed bi-annually and changes may be made thereto if any or all of the generation wholesale contract price, the Nigerian inflation rate, US$ exchange rate, daily generation capacity and accompanying capex, and opex requirements have varied materially from that used in the calculation of the tariff. A material variation for this purpose is defined as a price variation of plus or minus five per cent (+/- 5%) in any of these indices. A review of all inputs to the tariff calculation will commence in 2016 as the basis for a new Multi-Year Tariff Order (MYTO) to commence for 5 years from 1st June 2017.
The MYTO2 provides a 15 year tariff path for the renewable electricity with minor and major reviews bi-annually and every five years respectively.
The MYTO2 FiTs for 2012-16 in Nigerian Naira per MWh (N/MWh)
PV (ground mounted)
Small hydro (<30 MW)
The MYTO2 tariffs are negotiable: if a generator can prove that their costs are not in-line with the assumptions of the MYTO2, they may be able to negotiate a higher tariff.