TAQA FY 2020 Proforma Consolidated Results and Dividend Policy
2b Long-standing, transparent & internationally-aligned regulation
Business Model for Transmission and Distribution segment in Abu Dhabi
Key Elements of the T&D Regulation
Remuneration of transmission and distribution companies
Abu Dhabi government
objective & guidelines
Local Regulator
T&D suppliers
دائرة الطاقة
regulated by
the DoE
Abu Dhabi Distribution Company (ADDC)
Al Ain Distribution Company (AADC)
•
Abu Dhabi Transmission and Despatch Company (Transco)
حكومة أبوظبي
GOVERNMENT OF ABU DHABI
DEPARTMENT OF ENERGY
Abu Dhabi
Department of Energy
Regulation of energy
sector is fully aligned
with Government of Abu
Dhabi's objectives of
guaranteeing supply to
customers in line with
global levels of service
•
Regulates and
supervises the energy
sector in Abu Dhabi
Regulations and codes are
available publicly on DoE
website
Evolution of Regulatory Periods Since 1999
Revenue Flow in the Regulated Networks System
Transco
TUOS
Discos
(ADDC and AADC)
Gov't
subsidy
Tariff
Abu Dhabi
Government
Customers
RAB-based framework with transparent and
publicly available regulatory guidelines
Framework adjusted every 4 years, following a
stable methodology and internationally-aligned
regulatory WACC
Abu Dhabi networks' regulation in place since
1999, with no major changes to regulatory
principles since then
Revenue Building Blocks for Regulated Companies
MAR dominated by fixed component
at 85% of total revenues
Other Pass-Through
Performance Incentives
Variable Terms
MAR collected from end users and government
subsidy acting as a revenue balancer
PC1, 2, 3, 4 & 5
RC1
RC2
Previous regulatory periods
Current period
1999-2017
2018-2022
Next period
2023 2026
• Stable regulatory framework with same principles being applied since inception
of regulation in 1999
•
Regulatory periods usually last for 4 years
• Current RC1 period to be extended for an extra year to ensure continuity during
the Covid situation
Depreciation
Opex
Return on Capital
(WACC x RAV)
Required Revenue
Fixed Terms
Maximum Allowed
Revenue (MAR)
NPV framework to determine
Fixed & Variable terms
Sources: Abu Dhabi Department of Energy Regulation & Supervision Bureau (now superseded by the Abu Dhabi Department of Energy)
TAQA's constant dialogue with the regulator and
relationship with the DoE ensure a continuing
optimal regulatory environment
21
TAQAView entire presentation