MAN TO FG: How Electricity Act 2023 can boost economy

For the new Electricity Act 2023 to become a game changer for the manufacturing sector and boost the economy, the Manufacturers Association of Nigeria, MAN, has listed several policy directions the new federal administration can achieve its desired objectives of the new law.

A statement signed by Segun Ajayi Kadir, MAN Director General sent to Sunday Vanguard, counselled President Bola Tinubu that the success of the Act would largely rest on its effective implementation and therefore, the President should appoint a committed and incorruptible Minister of Power that has broad experience of the operations and politicking within the power sector.

According to Ajayi-Kadir, “the Federal Government should begin the process of rendering legal, financial and technical supports to state governments yet to establish electricity market laws.

Complementarily, MAN added “State governments should partner with existing agencies and operators in the power sector as the costs of building new power distribution networks can render the investment less lucrative.

Still directing its attention to the states, the sectoral body also said government should “Streamline NERC and states’ regulations to avoid bottlenecks for multi-state investors, while it should also address the uneven distribution of gas to avoid delay in states’ execution of mega-power projects.

“While states concentrate on small confined democratised power supply systems,” MAN said, “There is need to have in the pipeline a long-term plan of ensuring operational efficiency of the national grid.”
MAN maintained that the power sector is highly capital-intensive. Therefore, there is need to reduce the lending rate to encourage private investments in mini-grids and renewable energy.

According to the MAN DG, government should also tighten the security infrastructure as no investor would want to do business in a terrorised economy.
Ajayi Kadir said, “The current power supply is apparently inadequate to satisfy the energy requirements of the manufacturing sector and the entire population.

“As the largest energy access deficit in the world, Nigeria’s shortage of electricity supply has been identified as a hindrance to the profitability of manufacturers with an annual economic loss valued at about N10.1 trillion or 2 percent share of the country’s GDP. The unfavourable situation has positioned the country among the worst countries to do business with a rank of 171 out of 190.”