Reflections on The Worsening Electricity Supply in Nigeria


The total shut down of Michelin tyre operations in Nigeria and the consequent retrenchment of 1,200 employees,is another warning signal that Nigeria’s operating environment is still very hostile to business survival.The firm’s shut down came at a time the Nigeria’s Power holding company {PHCN} announced a whopping 50 percent drop in power supply on account of epileptic gas supplies to its gas-fired thermal plants.

Michelin tyres,explained that high production costing caused by absence of reliable public power supply was the underlying reason for the closure of the Port Harcourt factory in Southern Nigeria.Michelin tyres,has been operating in Nigeria for 30 years,and had undertaken production and staff rationalization before finally giving up on the battle to survive the harsh operating environment.

The once thriving textile industry (the single largest private sector employer of labour in Nigeria)is down and nearly knocked out, essentially by epileptic public power supply.Regrettably,for 8 years,the new democratic Nigerian government has failed to provide any clue to the debilitating situation which has markedly shot up the cost of doing business.

In 1999,when the new democratic government took over the affairs of the nation,only 1,300megawatts was generated out of a national capacity of 6,500MW .After many failed promises and the collapse of many factories,the supply level was brought up to 3,800MW. But that marginal improvement soon crashed to 1,400MW . The PHCN concluded the situation may even deteriorate further. The imminent blackout,the power firm says,is due to gas shortage from Shell {biggest oil company in Nigeria},which is shutting down for maintenance. The PHCN had earlier scaled down power production on February 18,2006 from its Lagos thermal station,which supplies power to most southern parts of the country on account of vandalized gas pipelines.Hence the Lagos power plant output reduced from 1,500MW to 200MW.

Other usual excuses are alleged vandalisation of gas pipelines and low water level at the hydro power dams.These challenges would have easily been surmounted if the power sector reform had been promptly formulated and sincerely implemented.The belated power plant contracts awarded toward the end of 2006 did not yielded any result due to corruption.Lack of gas,for instance,stalled the start of operation of new power plants in December 2006.

Yet, Nigeria’s energy supply potentials are huge. The associated gas being flared in the Delta region{south-southern Nigeria} is enough to supply electricity to the whole of Africa if properly harnessed. But poor planning and lack of foresight have delayed the take-off of the various gas-fired power plants owned by the government and some independent power producers. The festering crisis in the oil-bearing has also reduced the prospects for improved power supply under this government. These strange coincidences of shut downs and general energy supply crisis probably prompted the National Union of Electricity Employees to suspect that the reduced power supply may be part of a grand plot to heat up the system and prepared ground for the government’s elongation of its stay in power.More curious is the report of Nigeria’s offer to export,beginning from February 2007, 80MW of electricity to assists some neighbouring West African countries of Ghana,Togo,and Benin.Ghana for instance is experiencing water shortages in its largest dam {Akosombo dam},which is seriously affecting electricity supply to industries.

Unlike Nigeria,Ghana has recorded at least five years of uninterrupted power supply.This is another strange coincidence- Why should a nation that is faced with the worst power supply crisis in the world be assisting another with a history of relative electricity supply with the little it has? Is it a case of charity beginning abroad instead of home?.

Adequate energy supply is so vital to the health of any developing economy in the world hence it should be taken seriously by the Nigerian government if the world will take its foreign investment serious.


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