THE POWER SUPPLY CONUNDRUM

Government must do more to resolve the challenge

The disclosure by the Nigerian Independent System Operator (NISO) that Poor electricity supply is costing the country an estimated N40 trillion every year should command a serious attention by all critical stakeholders. “A stable national grid unlocks economic growth, industrial productivity, and job creation,” NISO said in its latest industry report, describing unreliable power supply as one of the country’s most damaging economic constraints. And it is a shame that almost three decades of democratic government and billions of dollars of investment in the sector have not resolved this challenge. As NISO board chairman, Adesegun Akin-Olugbade, quite rightly noted, “electricity is a 19th-century technology, and we do not need rocket scientists to fix these problems.”

The only thing remarkable about this report is that it is from an official source. In a 2021 report, the World Bank had rated Nigeria as the poorest country in the world on power supply to citizens with 85 million people not connected to the grid and a loss of $26 billion annually. If anything, the situation in this critical sector has only worsened, with NISO now projecting a $29 billion loss going by its 2025 report. With everybody supplying their own electricity, Nigeria is one of the toughest places in the world to do business since lack of electricity has limited access to healthcare, education, and other opportunities for majority of Nigerians. Many small and medium scale businesses have been crippled due to the prohibitive cost of generating their own power. Even the big business ventures, particularly the manufacturing ones, are also feeling the biting effect of energy poverty with consequences stretching to every part of the economy. 

 It is indeed unfortunate that 13 years after privatisation of the power sector, majority of Nigerians have come to the inescapable conclusion that the process through which a host of other contemporary emerging economies successfully used to reset their electric power challenge is proving too difficult to be applied effectively on our shores. Instead of generating, transmitting, and distributing enough megawatts of electricity to homes and industries across the country, what we get almost daily are excuses from relevant authorities. 

At the ruling All Progressives Congress (APC) 4th Elective National Convention in Abuja last Friday, President Bola Ahmed Tinubu pledged imminent improvements in electricity supply, while outlining fresh interventions aimed at tackling Nigeria’s persistent power outages and strengthening the national grid. The newly created Grid Asset Management Company (GAMCO), according to Tinubu, will play a key role in boosting transmission capacity and stabilising supply nationwide. But considering that the presidential villa has exited that same grid by expending a huge amount of money on solar panel, not a few Nigerians would take the presidential pledge with a pinch of salt.   

To address the challenge of the sector would require a holistic reform. Several heads need to come out of the sand so that commercially sound solutions can be implemented. Before now, the common excuse for grid collapse was either that the transmission lines could not wheel the power so generated by the Gencos or non-availability of gas. Meanwhile, the Discos who were beneficiaries of the shambolic power sector reforms have all failed to invest in modernising and expanding the transmission lines. But that is not to suggest that the Gencos have fared better either. Many of the sector players are owed significant debts.

  However, whatever may be the reasons for the worsening electricity supply, Tinubu and his administration must understand that we cannot grow the economy without sorting out this critical infrastructure.