The Manufacturers Association of Nigeria (MAN) has expressed its concerns over the proposed increase in electricity tariff by the Distribution Companies (DisCos). The association warns that if immediate action is not taken to stop the tariff hike, it will have a detrimental effect on the country’s economy.
Scheduled to take effect from July 1, 2023, the planned tariff increase by the DisCos has raised alarms within the manufacturing sector.
In a statement released by the Director General of MAN, Mr. Segun Ajayi-Kadir, it was revealed that manufacturers had already spent a staggering amount of N144.5 billion in 2022 on alternative energy sources. This amount has seen an 87% increase from the previous year’s expenditure of N77.22 billion. The rising cost of accessing alternative energy has significantly impacted manufacturers’ finances.
The statement further highlighted that over the past eight years, electricity tariff has been raised by a staggering 186%. This alarming figure, coupled with the government’s own debt of N75 billion in unpaid electricity bills, paints a clear picture of how burdensome the cost of electricity has become in Nigeria.
Manufacturers have long grappled with the absence of stable, reliable, and affordable electricity supply in the country. Many industries have resorted to supplementing the unreliable power grid with alternative energy sources. This dependence on costly alternatives not only increases operational expenses but also hinders growth and competitiveness.
The proposed tariff increase by the DisCos will exacerbate the challenges faced by manufacturers and hinder the efforts to revive the economy. The Manufacturers Association of Nigeria implores the government to intervene swiftly and prevent this detrimental action from taking place.
