Power Distribution Enhancement Investment Program (Multitranche Financing Facility)

A rational tariff policy is essential for improving the financial viability of a distribution utility. Two tariff revisions (in 2016 and 2021) helped improve the financial viability of Azerishiq's distribution-strengthening projects. Although the upgrade of distribution systems is still not fully financially viable, an improving financial internal rate of return (into positive territory) illustrates the benefits of lifting tariffs toward full cost recovery. Further tariff increases will be required to improve and sustain Azerishiq's financial sustainability as it continues to invest in strengthening its distribution systems.