Against the backdrop of the worsening public power supply, new data have emerged showing that manufacturers in Nigeria spent a total of N246.38bn generating their own electricity between 2016 and 2017.
Further analysis of the data compiled by the Manufacturers Association of Nigeria showed that the operators spent N129bn in 2016 and N117.38bn in 2017 on private power generation.
The data also revealed that manufacturers spent a further N43bn on private power generation in the first half of 2018.
While reviewing the performance of the sector in 2018, MAN pointed out that a situation where the cost of electricity constituted 40 per cent of the cost of production was not manufacturing friendly.
It stated, “The challenge of inadequate electricity supply persisted in 2018, worsened by skyrocketing electricity price. Inadequate electricity supply remains a major driver of the cost of production.
“Our survey finding shows a slight improvement in electricity generation and distribution with the challenges coming from obsolete electricity infrastructure, weak transmission and distribution networks.”
MAN commended the Federal Government for efforts aimed at utilising stranded 2,000 megawatts of electricity through the Eligible Customer initiatives introduced last year.
The association noted, however, that the uptake of the stranded electricity was slow, owing to the conditions established for its access.
The government had specified that for customers to be eligible to access the stranded 2,000 megawatts, they should not owe any of the distribution companies.
In the light of this requirement, MAN recalled that there was a legal tussle between the association and some distribution companies, over poor management of the Multi-Year Tariff Orders, which led to the claim by the DISCOs that MAN members owed them.
The manufacturers urged the government not to allow any increase in electricity tariff in the face of inadequate supply.
They also sought support for stakeholders in the electricity value chain to improve generation, transmission and distribution.
MAN urged the government to intervene in the impasse between MAN, DISCOS and the Nigerian Electricity Regulatory Commission and resolve associated issues
The association also called on the government to relax some of the requirements for the uptake of the 2,000MW stranded electricity, so that manufacturers could leverage on the initiative.
While commenting on the performance of the non-oil sector, which fell from 12.1 per cent in 2015 to 4.6 per cent in the third quarter of 2018, MAN said the starting point to increasing non-oil export was to improve the productive capacity of the real sector.