Rising energy costs: Manufacturers spend N639 billion on power, self-generate over 14,000MW

As a result of the poor power supply from distribution companies, there is a rising energy cost which is disrupting productive activities in Nigeria as factories self-generate more than 14,000 megawatts of electricity.

As reported by The Punch, documents compiled from the Manufacturers Association of Nigeria on Tuesday reveal that companies spent N639 billion in alternative energy sources between 2014 and 2021.

The documents also reveal that manufacturers spent N25 billion in 2014, N59 billion in 2015 and N129.95 billion in 2016.

Moreover, they spent N117.38 billion in 2017; N93.11 billion in 2018; N61.38 billion in 2019; N81.91 billion in 2020, and N71.22 billion in 2021.

The figures have, however, varied over the years due to effects of inflation and the number of member companies in the association, among other factors.

The Chairman, Manufacturers Power Development Company of the Manufacturers Association of Nigeria, Ibrahim Usman, in an interview with The Punch, said “This is why we are talking about renewable energy today, especially solar, in addition to the regular gas and diesel-operated facilities.

“We have not utilised our natural endowments. In Morocco, Saudi Arabia, Algeria and several other countries, there are solar farms. We have sunlight in Nigeria and we need to start utilising it.”

In 2016, MAN set up a power development company to reduce high energy costs borne by factories across the country.

In 2014, a Professor of Economics, Adeola Adenikinju, carried out a survey in 2014 to determine how much self-generation capacity there was in the manufacturing sector.

The research, funded by the European Union and German government, found that manufacturers’ self-generation capacity was 13,223MW as at 2013.