“Let the poor breathe” — Surviving rising electricity tariffs in Nigeria
Image source: Vanguard
By Joshua Eesuola
In recent years, Nigerians have endured economic hardships comparable to the Israelites’ suffering in Egypt. Every glimmer of hope quickly fades into darkness, obscured by political and economic mysteries controlled by those in power.
Despite being battered daily by economic challenges, Nigerians have remained resilient. Local businesses continue to thrive, and Nigerians at home and abroad achieve remarkable feats, much like the Israelites who multiplied in strength despite their oppression.
However, there have been recent attempts to undermine the labour force, the strength and glory of the nation, similar to Pharaoh’s actions in the Bible.
The first blow was the hike in PMS and diesel prices, aimed at crippling local producers and manufacturers. Recently, the authorities have also increased electricity tariffs, further straining the labour sector.
On April 3rd, the Nigerian Electricity Regulatory Commission (NERC) announced that Band A consumers’ electricity tariffs would rise from #62 to #225, before a minor reduction to #206.8. Band A includes customers who receive up to 20 hours of electricity, predominantly in urban areas.
From the classification, the majority of rural areas fall into the category with minimal hours of electricity. So, how do we promote local industrialisation, which feeds urban industries with raw materials, if they have a shortage of electricity?
For instance, sawmills located in rural areas cannot operate efficiently without consistent electricity. Rice farms and other local industries also rely on electricity. The struggles of local industries inevitably impact urban industries as well.
Rather than increasing prices, the focus should have been on the equal distribution of electricity. All towns and cities should have equal access to electricity, not some enjoying 20 hours while others have minimal supply.
The Minister of Power, Adebayo Adelabu stated that the tariff increase was to attract investors to the energy sector. However, this seems to be a facade for other motives. Attracting investors to a market where consumers cannot afford the service is illogical.
There are economies of scale in business; investors will rather choose where the cost of production (energy being a chief factor and nearness to raw materials) is low. What will investors do in a country where there is little or no regard for the regeneration and conservation of raw materials? Is the decline of raw materials not one of the main reasons why many international firms are beginning to leave the country?
Increasing electricity tariffs is as damaging as raising import duties. When will we stop making decisions that harm our economy? It is paradoxical to increase import duties to encourage local production while simultaneously raising electricity tariffs that cripple those producers. It is no wonder people accuse the current administration of stifling the poor citizens of this country.
HARSH REALITIES AND COPING MECHANISMS
Many families in the city are unable to buy local PMS to provide electricity through generators because of the high price. They have been surviving with electricity, but now that electricity prices have increased by almost 300 percent, it will pose a significant threat to families trying to meet their energy needs.
Mrs. Chioma, an educator in Lagos who falls under the Band A category, lamented that her family now spends 20,000 naira on electricity every two weeks. She noted that some other families have resorted to using rechargeable torches at night.
She said, “The tariff hike has not been easy for us. My husband now spends 20,000 naira on electricity every two weeks. Some people have now started using rechargeable torches at night because it pays them more.”
Some women also stated that they have turned to using firewood as they cannot afford the bills that come with using electric cookers, and gas is also not an affordable alternative.
In these challenging times, Nigerians must find ways to adapt. It is evident that these hardships are orchestrated by the modern-day “Pharaohs” of Nigeria.
A very potent tool for adaptation is energy conservation and the promotion of local energy production. Industries, communities, and families must learn how to conserve energy to avoid being forced out of the economy.
The implication of an increase in electricity tariffs is an increase in production costs for firms. Local industries will struggle to maintain favorable prices amidst high production costs. If care is not taken, the price of locally produced goods may match that of foreign goods, leading citizens to prefer foreign products over local ones.
Professor Sam Enibe, a professor of Mechanical Engineering at UNN, emphasized that energy-saving measures are crucial. He stated, “Energy-saving measures are the key. Switch off any equipment you are not using. For example, security lights should be turned off during the day as sunlight is sufficient.”
He also advised adopting energy-saving devices, such as incandescent lights instead of normal bulbs and LED televisions instead of conventional ones. These measures can effectively minimize electricity costs.
Additionally, it is important for electricity meter designers and producers to develop meters that allow users to control their electricity consumption.
For instance, a family with a budget of 20,000 naira for electricity per month could set their consumption to 600 naira per day. An alarm could notify them when they are nearing their daily limit, prompting them to turn off appliances and conserve electricity.
Addressing concerns about the harmful effects of firewood smoke on rural women, Prof. Enibe suggested local measures to mitigate these effects instead of instilling fear. He noted that firewood is the primary means of cooking and running businesses for many rural families. Effective measures, such as digging deep holes to contain the fire, can reduce smoke exposure.
There is also a significant need to invest in local energy production. Firms, industries, and local and state governments should invest in solar energy bases, wind-vane energy, mini-hydro, and micro-hydro energy stations.
Prof. Enibe highlighted local energy production, stating, “Where communities have streams, they can construct a dam or channel a pipe where there is a waterfall. If the waterfall comes from a high point, a pipe can be constructed to direct the water to a machine below, generating electricity.” He noted that such projects are rare in Nigeria.
Since the deregulation of the power sector in 2005, progress has been minimal. The problem lies in the private investors, often politicians, who exploit the system. Toyin Ogunbiyi, in his article “Power Sector Reform: Is Nigeria Getting Its Deregulation Policies Right?” stated, “There’s no essence of deregulation if people can’t be availed the opportunity to opt for the best service providers.”
For of a developing nation like Nigeria, economic growth is intricately tied to stable electricity. Industries and communities thrive on a consistent power supply. Local and state governments must invest in micro-electricity generating plants, which can significantly impact both rural and urban areas. These small power stations, distributed across the land, will enable communities to prosper.
Furthermore, host communities should demand that companies utilising their land provide electricity in return. These partnerships can enhance community development and ensure mutual benefit.
Embracing energy conservation and investing in local energy production research are vital for thriving in this challenging economy.
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