Strategy
Financial Analysis
$200M
Total project cost
Construction, financing, and pre-operation costs
14–16%
Return to owners
Equity IRR over a 20-year hold, USD-indexed revenue
1.45x
Loan repayment cushion
Cash flow available relative to loan payments, average over loan life (DSCR)
4.5 yrs
Owners' payback
Time until owners recover their original investment
Revenue
PPA tariff anchored at $0.085 per kWh, with an annual price increase of 2.5%. The plant runs at 22% capacity factor (Lagos solar irradiance corrected for shading and panel degradation). Combined annual generation across the anchor plant and the C&I portfolio reaches around 135 GWh in steady state. That produces roughly $11M of annual revenue, with carbon credits adding another $1.5 to $2M.
Costs
Construction at $0.85 to $0.95 per installed watt, consistent with 2025 Sub-Saharan benchmarks. Operations and maintenance at 1.2% of construction cost per year. Land lease at $25,000 per MW per year. Insurance and overhead at 0.8% of construction cost per year.
Sensitivities
| What the model absorbs | What breaks it |
|---|---|
| Naira depreciation to ₦2,000/USD (PPA indexing absorbs it) | A federal-level reversal of the Electricity Act |
| One missed PPA in years 1 to 3 (portfolio model has redundancy) | Loan repayment cushion falling and staying below 1.1x |
| Construction overrun of 12% (contingency budget covers it) | A Nigerian banking crisis that freezes naira working capital |
| One anchor customer default in years 4 to 8 (cushion drops to 1.2x but holds) |
The economics work because the design works
The base-case return clears JCM's required threshold for frontier-market projects with margin. The case is not optimistic; it is consistent with what JCM has delivered in Malawi at smaller scale.