By Vanguard News
Prominent
members of the Organised Private Sector, OPS, yesterday raised concerns over
frequent collapses of the national power grid, saying the development is
crippling already distressed businesses.
Among
the business groups that expressed concern were the Nigerian Association of
Chambers of Commerce, Industry, Mines and Agriculture, NACCIMA; Manufacturers
Association of Nigeria, MAN; and the Lagos Chamber of Commerce and Industry,
LCCI.
This
is even as the Nigeria Employers’ Consultative Association, NECA, warned that
the frequent collapse of the national grid has continued to hinder economic
growth and slow down enterprise sustainability efforts, given the high energy
costs businesses currently have to deal with.
The
Manufacturers Association of Nigeria, MAN, said frequent grid collapse was
frustrating for Nigerian manufacturers, considering the huge costs spent on
re-energising production lines shut down anytime the grid collapses.
Please
recall that the national grid collapsed thrice in 24 hours last week, and the
power supply has yet to be completely restored across the country.
The
Director-General of LCCI, Dr Chinyere Almona, who called on the government to
consider privatisation of the national grid, said: “LCCI is deeply concerned
about the frequency of collapse recorded by the national grid, the sole supply
source of hydroelectric power nationwide.
“This
year alone, we have recorded eight grid failures, with three being recorded
within a week. The worsening performance of the national grid is an issue of
concern to the business community.’’
Almona
lamented that the relevant authorities seem to be at a loss on the root causes
of the incessant collapses, with no lessons learned.
“By
now, after numerous failures, the national grid managers should have identified
the root causes and found lasting solutions. It is concerning that there
appears to be no clear understanding of these causes or lessons learned from
the restoration processes.
“After
about 105 collapses in 10 years, power sector stakeholders should know what
drives these recurring failures and how to prevent them.
“We
are troubled by the apparent lack of such understanding among regulators in the
power sector,” she lamented.
On the
way out, Almona stated: “With businesses suffering from the burden of poor
power supply, we need quick intervention actions to salvage the situation.
“We
urge the government to consider privatising the national grid and support more
efforts to scale up metering in the coming months.
“In
finding a lasting solution to the perennial poor power supply and the recurring
collapse of our national grid, the government should create the needed
conducive regulatory environment, extend concessionary credit to operators in
that sector, offer import waivers, and collaborate with the private sector to
work together in policy formulation and implementation.”
Frustrating
for manufacturers —MAN
On his
part, the Director General of MAN, Segun Ajayi-Kadir, said the frequent
national grid collapse is frustrating for Nigerian manufacturers, considering
the huge costs spent on re-energising production lines that are shut down
anytime the grid collapses.
He
said: “It’s unacceptable that most manufacturers have to always shut down
production lines anytime national grid collapse occurs in the country.
“To
re-energise those production lines takes extra production costs, and they are
still expected to be billed 250 per cent electricity tariff by power electric
companies without factoring the menace causing the frequent breakdown in the
national grid.”
He
noted that the public hearing on the national grid collapse scheduled for
Thursday, October 24, (tomorrow) by the Nigerian Electricity Regulatory
Commission, NERC, is necessary if it is designed to find ways forward to
stabilise power supply.
“The
greatest challenge facing Nigeria’s economy currently is insecurity, and if you
talk about manufacturing, the second is energy.
“There
is no way manufacturing can thrive perfectly when you don’t have a steady and
affordable power supply,” he stated.
Mere
infrastructure upgrades insufficient, full privatisation needed —NACCIMA
In his
reaction, the President of NACCIMA, Dele Oye, said the situation calls for a
move towards a comprehensive and strategic privatisation of the power sector.
Oye
said: “The recent spate of national grid collapses in Nigeria has raised
significant concerns for our economy and the operational viability of
businesses across the country.
“With
the grid failing multiple times in recent months, businesses have been
grappling with erratic power supply, which disrupts production lines, inflates
operational costs, and ultimately affects profitability.
“The
implications are dire: Prolonged outages hinder productivity and lead to lost
revenue, while small and medium enterprises, often the backbone of our economy,
struggle to survive under the weight of high generator costs and maintenance.
“This
situation not only stifles business growth but also erodes consumer confidence
and limits job creation. While the Siemens contract represents a step in the
right direction toward modernizing Nigeria’s power infrastructure, it is
evident that mere upgrades are insufficient.
“A
comprehensive and strategic move towards fully privatizing the sector could
invigorate it with much-needed efficiency, innovation, and investment. By
unlocking private sector potential, we can enhance competition and drive
improvements in service delivery that our businesses and citizens desperately
need.”
It
hinders economic growth, says NECA
Similarly,
the Nigeria Employers’ Consultative Association, NECA, warned that the frequent
collapse of the national grid hinders economic growth and slows down enterprise
sustainability efforts.
NECA’s
Director-General, Mr Wale-Smatt Oyerinde, who stated this in an interface with
Vanguard yesterday, urged the government to expedite action in overhauling the
grid and also create the environment for private investors to invest.
He
said: “It is quite worrisome that the national grid continues to collapse. At a
time there is an urgent need to fast-track the nation’s industrialization
efforts, we are still bogged down with constant grid collapses.
“This
constant collapse hinders economic growth and slows down enterprise
sustainability efforts, given the high energy cost that businesses currently
have to deal with.
“We
urge the government to expedite action in overhauling the grid and also create
the environment for private investors to invest. The future and our potential
for energy sufficiency lie with the private sector.”
Reduces
competitiveness of Nigerian businesses — ASBON
Also
reacting yesterday, the President of the Association of Small Business Owners
of Nigeria, ASBON, Dr Femi Egbesola, said the ability of Nigerian businesses to
compete internationally is being impaired as grid collapses lead to an increase
in production costs.
His
words: “The failure of the national grid has serious consequences for Nigerian
businesses and economy. It leads to industrial output being lowered and
manufacturing expenses being raised as a result of frequent power outages that
interrupt production operations.
“As a
result, this reduces the ability of Nigerian businesses to compete
internationally as the cost of production shoots up above board.
“Additionally,
many firms are forced to invest in alternate power sources, such as generators,
which dramatically raise our operational expenses due to the unpredictability
of power supply.
“Nigeria’s
economy suffers greatly from the regular failure of the national grid. It
reduces output in manufacturing and services, raises household expenses, and
slows growth in the economy as a whole.
“As a
result, we the business community, request and advocate for immediate and
long-term responses to this issue.”