Oxford Business Group says power shortage blocks fresh investments in Nigeria’s manufacturing sector
Nigeria, Africa’s biggest economy, suffered N7.1 billion loss to gross electricity deficit rocking the country in the last one year.
This, economic experts at the Oxford Business Group said, came as the country with a population of over 180 million, supplies a meagre 3,500 mega watt daily.
The power shortage, the latest report by OBG experts read, blocks fresh investments in manufacturing.
Noting that Nigeria “is in some ways a natural choice for investment in industry and manufacturing because it is the seventh-most populous country in the world,” the report noted that the country’s “inability to meet demand for power with a steady supply has cost N71 trillion ($229.5 billion) in lost Gross Domestic Product (GDP) in the last century.”
This loss, which is N71 billion in ten years, translates to N7.1 billion loss in one year.
Nigeria, the report read, enjoys “an abundance of potential customers as well as affordable labour. It hosts a variety of globally recognised goods producers, chiefly in consumer staples.”
Nestle, PZ Cusssons and Guinness Nigeria, whose brewery in Lagos was the first facility to produce the famous beer outside Ireland and the UK, the report read, “are some established actors in the economy.”
The Oxford Business Group continues: “The manufacturing sector has long been inherited, however, by the general difficulty of doing business in the country, as well as the scarcity of electricity. Per capita consumption of electricity was higher than only eight other countries in 2014, the most recent year for which global data is available from the World Bank.
“The power counts as one of many areas, which Nigeria welcomes foreign investment, but a few outsiders have chosen to invest in any electricity project, using the national transmission grid on purely commercial terms.
“Foreign capital in the sector has largely been paired with or limited to development finance initiatives, small-scale projects and off-grid alternatives in which power producers serve a small area and are not exposed to the national system.”
Nationwide blackout, it would be recalled, rocked Nigeria on January 13 as National Electricity Transmission System known as national grid suffered two collapses in one day, the first in year 2020.
The collapses, which happened exactly 33 days after the last one, were the 14th and 15th system failures in the last 13 months.
The system, checks by this newspaper showed, collapsed first at 12:34p.m resulting in power outage in Abuja, Lagos and other major cities of the country.
The system, New Telegraph learnt, was restored at 1:10p.m before the second collapse at 2:15p.m., which threw the entire country into blackout.
The Transmission Company of Nigeria (TCN), owner of the grid, confirmed the development in a statement obtained by New Telegraph from its Twitter page.
“There was a system disturbance, which occurred about 12.34p.m, affecting some parts of the country.
“As of 1:10p.m., supply was restored to Abuja and most parts of the affected areas. TCN is still working to completely restore and stabilise the nation’s grid,” it said.
The first collapse was also confirmed in a tweet by Eko Electricity Distribution Company (EKEDC).
“Dear Customer, present outage affecting all is a TCN System Disturbance on the grid. Power to be restored as soon as available.
“Dear customer, the outage which occurred at 1237hrs is due to a TCN system collapse affecting Lekki, Ibeju & environs. The team is working to restore power. Please, bear with us,” the company said.
Ikeja Electric, which also confirmed the second grid collapse, maintained on its Twitter account that the failure threw the entire Lagos into darkness.
Another collapse of the grid, the utility firm said, occurred at 2.15p.m.
“Dear customers, the outage you are experiencing is due to a system collapse of the grid, which occurred this afternoon at 12:36p.m. All parts of IE’s network are affected.
“Another system collapse was recorded at 2:15p.m. today. Restoration efforts are on-going. Kindly bear with us,” the electricity distribution company said.
Source: New Telegraph