The Manufacturers Association of Nigeria has stated that manufacturers spent at least N60.4bn on alternative energy sources in the first half of 2023.
According to MAN’s recently released Half Yearly Economic Review, this is a 21.25 percent increase over the N76.7 billion spent on alternative energy during the same period last year.
The increase in electricity supply from the national grid to the businesses in the first half of this year to 11.3 hours per day from 10.2 hours recorded in the same period of 2022 was cited as the reason for the decline in manufacturers’ spending on alternative energy sources.
When compared to the 10.6 average hours per day of electrical delivery during the same period last year, the electricity supply increased by 42 minutes, the report noted.
According to the research, the average number of outages each day climbed slightly from 4.4 times in the first half of 2022 to 4.7 times overall.
“In light of this, spending on alternative energy sources decreased to N60.4 billion in the first half of 2023 from N76.7 billion in the second half of 2022, a fall of N16.2 billion or 21.2 percent over the same time. It also fell by N7.3 billion, or 10.8%, from the N67.8bn recorded in the same period of 2022.”
Oil marketers claimed last month that the recent adoption of a 7.5% Value Added Tax on Automotive Gas Oil, often known as diesel, and the nation’s current foreign exchange crisis had driven up the price of the commodity to between N900 and N950/litre in various areas.
The trend, according to local manufacturers, may result in the closure of some factories and the loss of jobs.
In response to the situation, the Director-General of the Nigerian Textile Manufacturers Association, Hamma Kwajaffa, stated that numerous textile producers were considering closing down their businesses due to increased prices, which were mostly brought on by skyrocketing energy bills.
The DG said that textile producers couldn’t afford to purchase diesel at the projected N950 price.
“Many are considering closing for the time being,” he said. “That kind of sum is beyond our means. Today, there are fewer than 24 textile (firms), and those that are still operating are thinking about closing. They’ve been forced up against the wall. These companies are not charities. They need to turn a profit.”
In a similar vein, the chief executive officer of Coleman Technical Industries Limited, George Onafowokan, claimed that rising diesel prices indicated rising manufacturing costs for the business.
