Power shortage costs businesses in Nigeria an extra $300,000 a month

0
208

IT is costing Nigerian conglomerate Chicason Group a whopping $300,000 extra month to provide electricity for the business because of the constant power shortage in the country, according to the founder and Group Executive Chairman, Dikanna Chika Okafor.  He said this was making it difficult for the company to plan ahead.

‘At this juncture what we would like to have is stable power [and] maybe later along the line we can look at the environmental effects and going greener,’ he told the Wall Street Journal recently.

The company, which employs 2,000 workers, is one of many Nigerian businesses that have seen their operating costs rise massively because they have to spend extra cash on buying diesel oil to fuel their back-up generators.

To deal with this challenge, the Nigerian government has announced that it will start producing electricity using coal. The aim is to see coal-powered plant contribute its portion to the projected 30 per cent power mix in Nigeria by 2030, which will cost about $3.5 billion a year.

President Muhammadu Buhari’s government is worried about the perennial destruction of oil pipelines that has been aggravating the power shortage in the country.

Earlier this year, Nigeria’s Minister for Power, Works and Housing, Babatunde Fashola, said: ‘Africans have trillions standard cubic feet of natural gas reserves, billions of barrels of crude oil reserves and billions of tons of coal; but Africa has even greater abundance of renewal energy resources.

‘Unfortunately, of the nearly 1.5 billion people estimated to lack electricity supply the world over, half live in Africa. Nigeria alone is estimated to have over 90 million people living without electricity supply according to the World Bank,’ Fashola added.

The move by the Nigerian government to turn to coal to produce electricity is being welcomed by businesses that pay a fortune to get constant electricity in the midst of the power shortage. According to official figures, Nigeria has some two billion tons of coal reserves that the government is looking to exploit to drive the country’s economic growth.

Despite opposition from climate change activists, energy experts argue that coal is still the number one provider of electricity around the world and this should be good for Nigeria, if the government can ensure clean production of the fossil fuel. Developing countries are keen to harness the power of coal.

Fashola contended: ‘I think it’s simplistic to begin to separate renewable energy from fossil fuel. What the world really needs is to achieve a balance.’

The London-based World Coal Organisation has been having a series of discussions with a range of stakeholders for high-level discussion on coal and its relevance to the UN’s Sustainable Development Goals (SDGs). The first one was held in London in March and the most recent took place in Johannesburg in July.

The process ‘aims to define a pathway for coal and the coal industry to support the achievement of the SDGs and will help to inform a potential mapping exercise in 2019.’

Throughout the discussion in South Africa, many participants made clear the important role played by coal across southern Africa.

They noted that coal had a positive impact on economic development, through job

creation and in its role as an energy source, export revenue earner, an industrial input and in liquid fuel production.

Coal mining employs directly and indirectly around 200,000 people across South Africa.

‘The importance of coal to economic development has implications for its contribution to the SDGs and shapes specific regional issues that should be considered,’ the WCA noted.

The focus will be on these issues at the upcoming Power Nigeria Exhibition and Conference in Lagos. Taking take place from September 25 to 27 it will look at how Africa can tackle its power shortage while providing delegates with the latest solutions to deal with the problem, according to organisers.

Delegates will discuss mini-grids, mini grids initiatives, smart metres, solar projects and the implementation of blockchain within the power sector in a bid to provide power to a continent where some 600 million people do not have access to electricity.

 

 

LEAVE A REPLY

Please enter your comment!
Please enter your name here