Nigeria’s electricity problem has continued to linger despite significant investments in the sector.
In the previous week, a section of the national grid was disrupted, causing widespread blackouts across most eastern states.
According to the communique of the recent monetary policy meeting of the Central Bank, the apex bank noted that it has disbursed a cumulative sum of N1.3 trillion to electricity generation companies (GenCos) and gas companies (GasCos) under the Nigeria Bulk Electricity Trading Plc – Payment Assurance Facility (NBET-PAF). The bank further stated that it distributed an aggregate of N251.93 billion to Nigerian Distribution Companies (DisCos) for their operational Expenditure (OpEx) and Capital Expenditure (CapEx) under the Nigeria Electricity Market Stabilization Facility – Phase 2 (NEMSF-2).
Despite these investments, Nigerians still grapple with epileptic power supply due to multiple grid shutdowns and the country’s inability to generate energy at full capacity. All this is in addition to high energy costs.
A look at the data from the Transmission Company of Nigeria (TCN) shows that Nigeria’s power generation was at an average of 77.11GWh between the 13th and 18th June 2022, with a peak generation of 3,651.5MW; this is lower than the average of 77.56GWh generated in the previous week.
Fuel scarcity hits some states
While many Nigerians have switched to alternative sources of energy to run their businesses as a result of the epileptic power supply and constant blackouts, petrol scarcity has resurfaced in major cities across the country.
Long queues have been spotted by Smartpreneur researchers in Lagos, Ogun, Oyo, and the Federal Capital Territory, with some filling stations selling petrol for as high as N190 per litre.
This follows the fuel scarcity witnessed earlier in the year, when adulterated fuel was found in the market, leading to weeks of sustained fuel scarcity and hikes in transportation costs. This time around, business operations have been hampered significantly considering the lingering power problem highlighted by the country’s inability to produce 8,000MW of energy despite boasting of having such capacity.
Many businesses have been forced to reduce their working hours to reduce fuel costs, especially as the price of diesel is projected to hit N1,500 per litre in the coming weeks. At the moment, diesel sells for as high as N850 per litre compared to the N350 per litre price it sold for earlier in the year. The significant hike in energy costs has triggered an 11-month-high inflation rate of 17.71% recorded in May 2022, with a further uptick expected in the current month.
