MAN Calls for Electricity Tariff Reduction, Caution on GDP Rebasing
The Manufacturers Association of Nigeria (MAN) has reiterated its determination to push for a reduction in electricity tariffs while cautioning the Federal Government against politicising the planned Gross Domestic Product rebasing process.
MAN’s leadership, during its recent presidential media luncheon in Lagos, highlighted it will not stop advocating for a reduction in the electricity tariffs in 2025 as the high costs continue to pose a challenge to manufacturers.
President of MAN, Francis Meshioye, decried the 250 per cent increase in electricity tariffs that the association earlier petitioned, describing it as “not palatable and not logical.”
He emphasised the need for a more gradual approach to tariff adjustments, noting the detrimental impact of the hike on businesses.
“Our next line of action on electricity tariffs is that we will not stop advocating for a reduction,” he said. “I don’t see any logic in having an increase of 250 per cent at a go.
We believe there should be a roundtable discussion to reduce this tariff. An increase is fine, but definitely not astronomically at 250 per cent. You can always set a timeline to graduate the tariff and achieve that goal.”
Meshioye criticised the government’s lack of responsiveness to MAN’s advocacy and called for constructive engagement to resolve the matter. “We will not relent in our advocacy to see that this tariff is reduced,” he affirmed.
Similarly, MAN’s Director-General, Segun Ajayi-Kadir, recounted the association’s legal and administrative efforts to address the issue.
Ajayi-Kadir noted that despite petitioning the Nigerian Electricity Regulatory Commission and seeking court intervention, manufacturers have faced hurdles.
“We petitioned NERC as required by law, but during the pendency of our petition, our factories were being disconnected,” he explained. “While that was going on, we ran to court to say, ‘Stop them from disconnecting us until they finish,’ but they refused. Somehow, they got a political judgement, our case was dismissed, and our injunction was vacated.”
Ajayi-Kadir highlighted the unreliability of the national grid, which he described as a “permanent decimal.” He revealed that alternative energy sources currently contribute about 6,500 megawatts, exceeding the national grid’s capacity of 4,000 to 5,000 megawatts.
“Last year alone, we experienced 12 national grid collapses,” MAN’s DG noted. “The increase of 250 per cent has not solved the problem.”
He also questioned the rationale behind funding inefficiency in the power sector, querying, “If you say you are targeting costs, which costs are you targeting? Are you funding incompetence, inefficiency, and incapacity?
“How can I produce toothpaste that hurts your mouth and tell you to continue buying it because paying more will help me make it better?”
Meanwhile, Ajayi-Kadir addressed the need for a rebased GDP, expressing support for accurate economic valuation but cautioning against its misuse.
“It is accepted that you need to correctly value your economy because it indicates its strength and viability,” he submitted.
However, the MAN DG warned against including illicit activities like smuggling and kidnapping in the assessment, as this could appear to legitimise such activities and attempts at using them to cloak underperformance.
“There is wisdom behind rebasing,” Ajayi-Kadir added. “The only thing is that you need to do it correctly and should not weaponise it. You don’t use it as a political tool to water down the enormity of the challenge of the country.”
Further, MAN pledged to collaborate with the National Bureau of Statistics to ensure the rebasing process is thorough and credible, asserting, “We are already having some collaboration with them. Data is king. As the saying goes, In God we trust; every other person must bring data.”
The association stressed that accurate data is essential for the success of Nigeria’s manufacturing sector and the country’s overall economic stability.
“Nigeria should ensure that the rebasing is done correctly so that we do not just dress ourselves up in garments that we do not merit,” Ajayi-Kadir concluded.
