The World Bank has disclosed that approximately $29 billion is lost every year for Nigerian businesses as a result of the country’s unreliable electricity.
According to the bank, Nigeria also has the most people without access to electricity in the world, with one out of every ten people without access to electricity now residing in Nigeria.
The bank’s positions were outlined in the Power Sector Recovery Programme Fact sheet, which was presented on Wednesday during the it’s virtual dialogue with energy reporters.
Ashish Khanna, the bank’s Practice Manager for West and Central Africa Energy gave the presentation.
“Businesses in Nigeria lose around $29 billion annually due to unreliable electricity,” the report said stressing that Nigerian utilities are only compensated for half of the energy they consume.
“Of every N10 worth of electricity received by Discos (distribution companies), approximately N2.60 is lost due to inadequate distribution facilities and power theft, while another N3.40 is not compensated for by customers.
“Six out of ten registered customers are not metered, and their energy bills are opaque and confusing. This leads to a lack of willingness to pay energy bills.”
According to the PSRP document presented by the bank, only 51% of installed capacity was available for generation, owing to the fact that the average Nigerian consumed four times less energy than her counterpart in a typical lower middle-income country.
It also claimed that the government had been paying the difference for years in order to assist poor Nigerian families in paying their bills.
“However, since wealthier households use more energy, a large portion of government assistance ends up going to those who don’t even need help to pay their bills,” he said.
The PSRP, according to the bank, is a comprehensive response to Nigeria’s power challenges, with the goal of renewing the country’s economy by rebuilding a functional and equitable power sector.
It also stated that the World Bank Board approved $1.25 billion in financing to assist the government in its efforts to reset the power sector between June 2020 and February 2021.