Manufacturers under Band A electricity struggling, says MAN
The Manufacturers Power Development Company Limited, established by the Manufacturers Association of Nigeria, has expressed concern about the unsustainable energy costs faced by manufacturing firms, particularly those in the Band A electricity category.The company has taken proactive steps to address this issue, providing sustainable energy solutions to ten businesses as part of a larger initiative aimed at lowering power costs and increasing energy efficiency for manufacturers across the country.
The acting Managing Director of MPDCL, Oweh Mba-Sam, announced this development in Lagos recently, emphasising that the collaboration with these ten companies is the first phase of a larger project aimed at closing the energy gap and making energy more affordable for the manufacturing sector.
"If you're on Band A, you already know how much power costs. If you are a manufacturer and are on Band A, you are in serious trouble. And the Manufacturers Association of Nigeria cannot have a power company while its members are struggling with Band A," Mba-Sam stated, emphasising the urgent need for alternative solutions.
He also revealed that MPDCL is leading an initiative to encourage manufacturers to use renewable energy solutions, particularly solar power, to address the country's ongoing energy challenges.
Mba-Sam stated that the company is advocating for a "Power as a Service" model, which allows manufacturers to install energy equipment at no upfront cost, with companies only required to pay an agreed-upon tariff that is lower than current grid rates.
"You sign it, and it is installed for you and will be there for 20 years or 15 years depending on the agreement," Mba-Sam told me.
He emphasised the importance of MPDCL's renewable energy model in assisting businesses to avoid the high costs associated with relying on power from the national grid.
He stated that the first phase of the MPDCL project is already supporting ten companies, with each receiving at least 1 MW of power, for a total of approximately 10 MW. This initiative is a significant step towards addressing manufacturers' energy shortfall.
Looking ahead, Mba-Sam stated that MPDCL's ultimate goal is to systematically bridge Nigeria's energy gap by expanding the model to more companies across the country, thereby providing a sustainable and cost-effective energy alternative for manufacturers.
"The most challenging aspect is finance. You can do almost anything once you have financial resources. So we began by looking for single-digit finance offshore. Right now, we have ten companies on our list, each with a minimum of one megawatt. That is a lot. That's about 10 megawatts of line.
"Our idea is to continue this process until we see the gap start closing until it evaporates," according to him.
Francis Meshioye, President of MAN, also stated that MPDCL's initiatives align with the broader goals of the upcoming Manufacturers Energy Security Summit, which will be held in Lagos from November 19 to 21.
The summit will address energy challenges and investigate sustainable energy solutions for the manufacturing sector.
Meshioye announced that the summit will bring together industry leaders, policymakers, and energy experts to discuss sustainable energy solutions for industrial growth.
"It is critical that we address these challenges head on," Meshioye said, noting that the summit will serve as a forum for collaboration among public and private stakeholders.
"By addressing energy security, we can unlock the full potential of our industries," according to him.
It was previously reported that the Manufacturers Association of Nigeria has increased its advocacy for lower electricity tariffs for manufacturers.
This includes pursuing legal action against the Nigerian Electricity Regulatory Commission and electricity distribution companies. However, the lawsuit ultimately failed.
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