(DDM) – Economist Bismarck Rewane has warned that Nigeria’s worsening electricity crisis is a major threat to the country’s economic growth and long-term development.
Rewane, the Managing Director of Financial Derivatives Company, stated that urgent and comprehensive reforms in the power sector are no longer optional but necessary for national progress.
He described the current state of electricity supply in Nigeria as unstable and insufficient to meet the demands of a growing population and expanding economy.
According to him, the persistent power shortages are increasing the cost of doing business and weakening industrial productivity.
He explained that many companies across manufacturing, services, and agriculture are forced to rely heavily on diesel and petrol generators.
This dependence on alternative energy sources, he noted, significantly raises operational costs and reduces profit margins.
Rewane added that the high cost of energy is one of the key reasons many businesses struggle to remain competitive both locally and internationally.
He warned that without reliable electricity, Nigeria risks losing potential investors to countries with more stable energy infrastructure.
The economist emphasised that stable power supply is fundamental to industrialisation, job creation, and economic diversification.
He pointed out that small and medium-sized enterprises, which are critical to Nigeria’s economy, are among the worst affected by erratic electricity supply.
Many of these businesses, he said, spend a significant portion of their revenue on energy, limiting their capacity to expand.
Nigeria’s power sector has faced long-standing challenges, including inadequate generation capacity and frequent grid collapses.
Transmission infrastructure remains weak, with limited capacity to distribute generated power efficiently across the country.
Distribution companies also struggle with losses, poor metering systems, and revenue collection challenges.
Despite past privatisation efforts aimed at improving efficiency, the sector has continued to underperform.
Rewane stressed the need for coordinated reforms across generation, transmission, and distribution segments.
He called for increased investment in power infrastructure, including renewable energy sources such as solar and wind.
He also emphasised the importance of strengthening regulatory frameworks to ensure accountability and efficiency among operators.
According to him, policy consistency and transparency are critical to attracting long-term investment into the sector.
He further highlighted the role of government in creating an enabling environment for private sector participation.
Energy experts have consistently argued that Nigeria’s electricity demand far exceeds its current supply capacity.
With a population exceeding 200 million people, the country requires significantly higher generation output to meet its needs.
Rewane warned that failure to address the power crisis could slow economic growth and worsen unemployment.
He noted that industries dependent on stable electricity, such as manufacturing and technology, could continue to decline.
The situation, he said, also affects households, reducing quality of life and increasing the cost of living.
Analysts believe that resolving Nigeria’s electricity challenges would have a multiplier effect on economic development.
Improved power supply would enhance productivity, attract foreign investment, and boost overall economic stability.
Rewane concluded that decisive and sustained action is required to transform the power sector into a driver of growth rather than a constraint.
and then