Ausbeth N Ajagu
30 November 2004
Lagos — THE energy sector of any nation occupies a place of central importance in terms of its relative contribution to the national socio-economic goals of raising productive sector and therefore, higher living standard. Of all the sectors that make up the energy sector, perhaps none has a greater impact on the lives of the citizenry than electricity.
A nation's industrialisation and development are predicated on her ability to provide amongst others, quality infrastructure for her teeming population. These infrastructure include good road network, telecommunication, water supply and electricity delivery. In return, the citizenry are expected to pay their taxes and fulfill other civic responsibilities.
Just like the citizenry, all corporate organisations in a given polity are expected to equally pay their statutory taxes as well as be socially responsible by making positive and reasonable impact in their various areas of operation (society) whilst assisting the government (where necessary) for the provision of these infrastructure.
The Nigerian nation from time immemorial has suffered terribly due to maladministration and corruption. These past corrupt governments did very little towards the quality provision of these infrastructure, especially electricity, which unfortunately has left Nigeria a "dark" country.
The importance of quality and constant electricity delivery cannot be over-emphasised. Over the years, the Nigerian people have had to contend with about 10 per cent to 30 per cent electricity supply in their homes, factories, business premises and shops. These have not only brought untold hardship and suffering to the people but has continuously dealt a big blow on their businesses as companies are forced to include the huge cost of generating set purchase on their capital budget and high cost of diesel on their administrative budget. The ever-increasing cost of fuel due to unstable exchange rate and collapsed Nigerian refineries compound the already battered situation. Families and businesses that are unable to afford generating sets are left to their fate in the dark and most businesses eventually fold-up creating much more complex situations for the unemployment market.
This fact was confirmed by a study by the World Bank and the United Nations Development Programme that put Nigeria's economic losses from absence of constant electricity generation and supply at a staggering N66 billion per year. Electricity in Nigeria is a luxury as compared with what exists in most other countries, where abundant supply of electricity is taken for granted. Even our neighbouring and fellow African countries have celebrated years of constant and uninterrupted electricity supply. Thus, one wonders why this cannot be so in Nigeria with abundant human and material resources, vast area of land etc.
A regular electricity supply will amongst other things make our industries more competitive in terms of cost of production, encourage more self employment, especially in the unorganised sectors, e.g. metal fabricators, welders, barbers, tailors, brick making, radio and TV repair/works, printing, business centre operators, electricity engineers, panel beaters etc and thus reduce unemployment presently ravaging the country. This in turn will reduce social misbehaviour and crime as the unemployed and restive youths will be gainfully employed.
I have consistently opined that with quality and constant supply coupled with good security of lives and property, Nigeria would have solved about 60 per cent of her problems. This is because economic activities will strive, there will be increased Direct Foreign Investments (DFI) and our present experience of brain drain will drastically reduce.
Perhaps, what makes Nigeria's peculiar energy problem more imponderable and ominous is the fact that experts have estimated the country's installed capacity at over 200 per cent of actual demand. Ironically, the electricity sub-sector has continued to be characterised by lingering unreliability of supply to end-users.
This situation is not unconnected with the poor funding of the only Electricity Company in Nigeria - NEPA. Over the years, dwindling investments in the back-up capital plants and in maintenance and replacement works have ensued high incidence of over-loading and system interruptions.
For instance, records have it that in 2001, only N50 billion as released to NEPA out of the N75 billion approved by the federal government, whilst the N180 billion proposed in 2002 was cut down to N35 billion. In 2003, NEPA received nothing.
This has made the current average generating capacity to be between 2500 and 3000 mega watts.
It is sequel to the very important role of electricity in nation's building that I suggest that all hands must be on deck to find a lasting solution to the menace. Government alone cannot provide electricity, thus the need for participation of the private sector.
Whilst the privatisation process of NEPA is on-going, independent power projects (IPP) should be encouraged. The Lagos State government's independent power of commendation is the Rivers State IPP, NESCO (Jos) and others.
However, I have observed that most of the oil and multi-national companies are very complacent on helping the government towards the realisation of this all important goal of electricity for all as part of their social responsibility to the society.
I am aware that Mobil Producing is providing electricity for some communities in Eket, NLNG is providing electricity for some communities in Bonny town, Shell Petroleum provides electricity for host communities like Elem Sangama, Ekulama, Olu Asiri, etc, but all these are pockets of what is actually expected from them.
The various oil companies should individually and collectively fashion out means of assisting the government towards improving the electricity delivery in Nigeria. They should other than providing electricity for the nucleus communities where they operate, finance the quality electricity delivery to the Nigeria people as part of their social responsibility. Since we have identified poor electricity delivery as the major bane towards Nigerian development, nearing a crisis situation, I advocate a rethink by all oil companies operating in Nigeria to, as a matter of urgency, take the provision of this infrastructure as priority.
With the achievement of regular electricity supply, these oil companies will reap tremendously as their costs of production and operation will drastically reduce and will equally generate revenue from the sale of the aforesaid electricity to the public and formally they would have done good to the Nigerian people as socially responsible companies.
Government on her side should grant incentives to any oil company willing and able to help build this infrastructure by way of tax relief, etc, as we know that government alone would not be able to provide the electricity demand of the nation.
Dr. Ajagu is the ALT - Chairman of Small and Medium Scale Industry Committee of Manufacturers' Association of Nigeria
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