PwC MSME Survey 2020
Key considerations for the power sector
Consumers of electricity comprising households, industries,
commercial ventures, among others, have risen significantly.
Rising population and improvement in industrial and
commercial activities are key factors driving the trend. As a
result, demand for electricity has outpaced generation,
transmission and distribution capacity.
As at 2018, 5.7million households, about 51,000 industries
and over 770,000 commercial ventures were consumers of
power in Nigeria (NBS data).
PwC recommended that for the power sector to achieve
about 6.5 times increase in annual per capita consumption
by 2025, the stakeholders in the sector needed to accelerate
growth in power generation capacity and improve utilization;
expand the power transmission network and drive better
efficiencies; and establish/scale up efficient power
distribution capabilities.
PwC maintains that more power needs to be delivered
properly and adequately through the electricity value-chain to
the final consumers or end-users. To achieve this, expansion
of the on-Grid generation capacity by improving gas supply
to eliminate non-operational capacity, replacement of the
obsolete equipment at power plants to restore unavailable
capacity, investment in the development of new power
plants, as well as the expansion of existing plants remains a
key piece of the solution.
Liquidity crunch is the biggest challenge of the Nigerian
power sector today. Low collection, non-cost reflective tariffs,
distribution losses and the inability of Discos to meet their
payment obligations to the Nigerian Bulk Electricity Trading
Company (NBET) is some of the challenges impacting
liquidity in the sector.
PwC recommends that existing power must be effectively
monetized through the value chain. In essence, power
generated and delivered through the value chain must be
recovered at full monetary value.
PwC MSME Survey 2020
PwC
Source: https://www.pwc.com/ng/en/assets/pdf/power-roundtable-report-2017.pdf; https://www.pwc.com/gx/en/growth-markets-centre/assets/pdf/powering-nigeria-future.pdf
June 2020
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