http://businessdayonline.com/NG/index.php/news/76-hot-topic/18118-consumers-dispute-fgs-4000mw-generation-claim-


Industry operators say impact is minimal

Electricity sector stakeholders and consumers have hit back at the Federal Government's claim that the nation's electricity generating capacity has reached 4,000 megawatts, saying the claim was false and that generation has indeed nosedived to less 3,600 megawatts.

With most of the plants scheduled for maintenance, others producing less than installed capacity and most cities and towns across the country still grappling with long periods of lights-out, it would be 'unwise' for the minister to give the impression that the government was serious about solving the electricity sector problems, the stakeholders say.

They suggest that the country needs more strategic investment and an investment-friendly environment to convince consumers that they are developing a process that would end the sector's woes.

Muda Yusuf, director general, Lagos Chamber of Commerce and Industry, who strongly echoed this view, said he believes the government should be talking about fundamentals of sustainable improvement in power supply.

"Talking about 4,000 megawatts is only a sad reminder of the sorry state of affairs in this country. The escalating cost of diesel is a new concern to industrialists and the private sector as a whole", he told BusinessDay.

"There are issues of consistency and sustainability. The power issue is not just about generation. It is about the entire power delivery chain. Across this chain, there are loads of problems. In any event, should we be celebrating 4,000 megawatts at this stage of our development and with all the resources at our disposal as a nation?" he queried.

The minister of state for Power, Nuhu Somo Way, claimed recently that power generation had hit 4,000 megawatts, prompting mixed reactions from a cross section of Nigerians.

"As I am talking to you now, electricity supply from the national grid has been off since I resumed work today. We are currently running on our private generating set", says John Aluya, managing director, Crystal Glass Nigeria Ltd and Chairman of Apapa branch of the Manufacturers Association of Nigeria (MAN).

"If PHCN says they are generating 4,000 megawatts of electricity, I do not think it is true because we have not felt the impact so far. 4,000 megawatts should provide electricity to a reasonable extent for small scale industries to operate. Now, the price of diesel has gone up, so we are operating at a higher cost and as a result, consumers will have to pay more for our products".

Babatunde Odunayo, managing director, Honeywell Flour Mills Ltd, told BusinessDay that they had not been on public power supply for a long time now, so he wouldn't know if they were supplying up to 4,000 megawatts.

"Because we do not feel the impact of electricity supply from the national grid, we do not depend on them. You know, in manufacturing, any slight cut in power supply can destroy a whole production process, so, relying on PHCN will make us waste our raw materials and spend more".

"It is a far cry from what we expect," says Herbert Ademola Ajayi, national president, National Association of Chambers of Commerce, Industry, Mines and Agriculture, (NACCIMA).

Ajayi is optimistic, however. "We hope that in the next few months we will smile".

According to Solomon Onafowokan OON, national vice president, NACCIMA, "the claim by the Federal Government that it is currently generating 4,000 megawatts is not impacting on the electricity supply to the industries as all of us in Lagos State live with three to five hours supply every other day, helplessly.

"This has assumed a worse status in the last four weeks with serious shortage of diesel which is now selling at a prohibitive price of N140 per litre from between N95 and N100 a month back. We need emergency in this sector to get it right".

But while some Nigerians remain pessimistic, others are hopeful and attest to some improvement.

"I am saving some N1.5 million on my diesel consumption now. This attests to some improvement", says Billy Gillis-Harris, President of Forum of South-South Chambers of Commerce, Industry, Mines and Agriculture (FOSSCCIMA).

"It is a gradual process that will filter down and that is why consumers should channel their observations to the Chamber to pass on to the relevant authorities".

However, respondents to Businessday's inquiry across most cities, including Lagos, Port Harcourt, Kaduna, Maiduguri and Kano, say power supply averages only four hours on a daily basis.

Again, investigations show that most of the power plants have been shut down for maintenance, causing a shortfall of about 400 megawatts in generation.

Afam VI with a capacity to generate 650 megawatts has shut some of its units for maintenance according to an industry source. Ibom power plant which has capacity for 100 megawatts has been out of service for some time because of low supply of gas.

Further investigations revealed that Shiroro power plant is still suffering from the effects of an explosion which occurred in the plant about two months ago and which consequently dropped the capacity of the plant to100 from 600 megawatts.

Our source said the Shiroro plant managers did not realise that the explosion had affected the foundation of the plant and as a result, some of the units would have to be taken out.

In addition, the 100 megawatt Delta power plant which has been grappling with hydrogen problem has been out.

Has the FG proved it's claim though?

Righton:

Babatunde Odunayo, managing director, Honeywell Flour Mills Ltd, told BusinessDay that they had not been on public power supply for a long time now, so he wouldn't know if they were supplying up to 4,000 megawatts.

"Because we do not feel the impact of electricity supply from the national grid, we do not depend on them. You know, in manufacturing, any slight cut in power supply can destroy a whole production process, so, relying on PHCN will make us waste our raw materials and spend more".

A sad state of affairs. Must be tough to compete running on diesel when your competitors abroad are using cheap electricity. No wonder imports are still cheaper than goods made here.

eku_bear:


A sad state of affairs. Must be tough to compete running on diesel when your competitors abroad are using cheap electricity. No wonder imports are still cheaper than goods made here.

i tell ya its really difficult to make a good profit in Nigeria Manufacturing sector, poor road network, high lending rate, corruption, poor storage facilities and fierce competition by foreign goods makes life unbearable as a Manufacturer