POWER FAILURE: The economic Boko Haram Nigeria and West Africa must defeat

The Nigerian power sector is probably one of the most inefficient in meeting the needs of its customers/consumers anywhere in the world. The Power Holding Company of Nigeria, the government agency that is  responsible for making sure power gets to the over 160 million Nigerians is humorously said by Nigerians to be in the habit of always holding onto the power and releasing only the bills. Nigerians seem to have gotten themselves used to the incessant power outages.

Is Power Holding Company actually holding the power? The simple answer is NO. The company cannot distribute what it does not have. The power is not available for them to transmit or said the other way round. The quantity of power generated as compared to the need is just too minimal that it should leave one confused on how best fairly distribute it.

At the end of 2014, according statistics gathered by the Heinrich Boll Foundation Nigeria, the country had an installed power generation capacity of 8,000 Megawatts

Only 4,000 MW was being fed into the national grid. Several reasons were given for this huge difference between capacity and actual generation but the reasons does not reduce the energy need of the country, which is ever on the increase. The electricity need of Nigeria stands above 40,000MW and 192,000MW will be needed by 2030. With this huge gap, 80 percent of the population is left in darkness.

With an actual generation of 4,000Megawatts in 2015, attaining 192,00MW by 2030 will sound like a day dream but its attainable.

Effect of lack of power on the economy

The almost non-existence of power adversely affects living standards of the population and reduces the income of small and medium scale businesses that form the nucleus of most African societies. Right from the point of starting the enterprise. They are made to spend a bulk of their started up budget on ensuring there is power.

For an SME to start business in Nigeria, the would-be entrepreneur must set aside percentage of his/her budget for a generator that would be able to power his business premise and equipment or production area. He/she must also consider the cost of having to buy gas to keep the power going. This becomes a serious hindrance to economic growth, more that, the economy of the nation is vastly running on these SMEs. From the Aboki who sells Suya (barbecue) on the street to the medium size manufacturing factories, they all need power in one way or the other and with no power, generators always come in handy. What this means is that, there will be increased pollution and the demand for fuel and generators will increase. That will be good business for fuel importers but bad business for the nation.

The fuel import need of the country is greatly increased since there is no sufficient fuel refined locally. This will result in the reduction of the nation's foreign reserves as huge sums are used to import fuel to keep the country running.

                                                      Power failure and Poverty

Selling in the dark

Frustrated welder waiting for power

In Nigeria, the poverty level is said to be one of the highest according to statistics from the World Bank and others despite the enormous natural resources. One cannot explain why a country with such enormous wealth cannot power herself. Most of the electricity used by both business and homes in Nigeria is generated using generating sets.  In an economy where the majority of the people live on less than $2 a day, depriving them of one of the basic item in the list of social amenities like power in the 21st century makes the poverty bites even harder. 

Akin Iwayemi writing for the International Association for Energy Economics said "Energy and income poor Nigeria is energy resource rich and the sixth largest exporter of crude oil in the world. Nigeria’s persistent energy crisis has weakened the industrialization process, and significantly undermined the effort to achieve sustained economic growth, increased competitiveness of domestic industries in domestic, regional and global markets and employment generation"

In societies where the youths are gainfully employed, the level of crime is lesser. Employment generation, which is one of the challenges Nigeria face as a nation can be minimized if the power crises is resolved. Where there are no jobs, the poor will remain poor. SMEs spend more than they can afford to pay the few staff they can hire on generating their own power. If the burden of having to privately generate power is removed, SMEs may engage more hands.

The informal sector of the Nigerian economy has proven over the years to possess the ability to keep the unemployment level down.

Nigeria is known for its rich deposit of fossil fuels.  In the list of these natural blessings are natural gas, coal and of course solar power. At the moment. 22% of global electricity comes from renewable such as solar, wind and biomass.  

 All these when effectively harnessed can produce at least 40 percent of electricity Nigeria needs to provide the economic backing Nigeria needs for development, improve infrastructure, create employment and importantly – improve the standard of living in most communities.

However, the reverse is the case. Instead of the development, our power generation is on the decline. What is then responsible for this? Experts say lack of commitment and vision may be responsible for this. There is no concrete road map to combat the energy crises in the country. And if there is any, the political leadership of the country has not shown adequate commitment to see it materialize into adequate power for the people.

That we have a huge energy generation gap in Nigeria is no longer news. The existing power generated in Nigeria according to experts; is not up to 15% of the power required in Nigeria. How do we close the gap, what source of energy will be more efficient, sustainable, cost effective, less time consuming to set up (since the need is immediate)? These and more are some of the questions that the nation struggle to answer on the way to power and energy sufficiency.

The way forward

According to a document released by the Heinrich Boll Stiftung, the following recommendations were given:

·         Nigerians need electricity that would not run out. Gas is one step on the way, but its not the overall goal. Nigeria needs a 50-year energy policy to channel investment to where Nigerians will benefit most. This policy should address the challenges relating to oil, gas and renewable energies.

·         Instead of instead of one big and expensive system of gas pipelines, Nigeria needs a smart mix of the national grid and many off-grid solutions could be powered by renewable energies and by natural gas.

·         Renewables can reduce corruption: where communities own their electricity generation from renewable energy (like solar) they can control the contracts, payments and maintenance themselves, either through community cooperative or through the local government.

Sustainable power is possible in Nigeria and West Africa if we all show commitment. It begins from showing our displeasure at the current situation as citizens and calling on the leadership to do something about it. Increase awareness on the need to go for safe, sustainable, and cost effective  power generations avenues. We must also as a matter of urgency learn the culture of paying our public service bills including power.

Adanu Moses

4/8/2015