Electricity Distribution Companies (DISCOS) in Nigeria have announced another upward review of electricity tariffs, following the recent increase for Band A customers.
The DISCOS have proposed an increase from N206.80 per kilowatt-hour to N209.50 per kilowatt-hour.
However, Dataphyte’s analysis shows that while Electricity Distribution Companies (DISCOS) in Nigeria have successfully increased revenues generated per customer in 9 years, they supplied less energy to Nigerians in the same period.
The DISCOS supply the bulk of electricity needs in the country, with a few other mini power plants set up by firms and other individual alternatives like petrol/diesel powered generators and solar batteries.
Here, we explore the trends for each DISCO, revealing a mix of financial progress, supply declines and the relentless demand for energy by all.
An analysis was conducted on the 11 DISCOS in Nigeria.
EKO (EKEDC) emerged as the top DISCO in the electricity supplied over the last 9 years, followed by IKEJA (IEDC).
YOLA (YEDC) ranked least in the amount of energy it supplied among the 11 DISCOS.
The true measure of a DISCO’s service lies in the amount of electricity it supplied per customer.
This metric depicts the reliability of supply and the efficiency of distribution.
The decreasing electricity supply per customer side by side with increasing electricity billing per customer across DISCOS raises critical questions about equity and access to power.
Such a general drop in electricity supply by DISCOS could have reduced their customers’ quality of life and ease of doing business. At the country level, this could have impacted the education and health sector, technology and communication and most importantly the industrial sector of Nigeria.
Considering increases in what Nigerians pay for electricity, reducing the electricity supply can lead to stress and frustration among the people. It may also exacerbate inequality as those who can afford power solutions get an edge over those who cannot.
The lack of a consistent electricity supply also prevents schools, hospitals and other essential services from functioning perfectly. Lack of electricity prevents students from studying effectively and disrupts medical services among many more inhibitions.
DISCOS reduced energy supplied per customer from 3,050.29 KWh in 2015 to 2,067.45 KWh in 2023, a 32% decrease in electricity supplied to each customer.
In contrast, they somehow increased the average revenue they generated from each customer (both metered and estimated customers) from N41,873 in 2015 to N91,900 in 2023, ripping off over double revenue from each customer, at 119% increase within the period.
The data from 2015 to 2023 depict sectoral players that are smart at making money off their customers without serious interest in real productivity.
Nigeria and other countries in Africa have different electricity supply situations. Nigeria, being a large country with a significantly large population, faces challenges in providing consistent electricity to all its citizens. This often results in lower electricity supplied per customer compared to some other countries.
According to the (EIA), electricity consumption per capita in KWh/yr as of 2021 is measured by dividing the total electricity consumed that year by its population. Nigeria’s electricity consumption per capita was 127 KWh/yr as Ghana also recorded 548 KWh/yr.
In some African countries like Libya, Egypt, Ghana and others, the electricity supply situation is relatively more stable compared to Nigeria, with fewer instances of power outages. This could potentially lead to a higher average electricity supplied per customer compared to Nigeria.
There has been lower quality of life, decline in level of industrialization and many more over the years which may be as a result of the lack of consistent supply of electricity, although other factors also contribute to this asides lack of power supply.
Using the Human Development Index (HDI) as a proxy for quality of life, Nigeria’s HDI actually increased from 0.52 in 2015 to 0.548 in 2023. Despite this slight increase, Nigeria still falls below the Sub-Saharan Africa HDI average of 0.53 in 2015 and 0.549 in 2023.
There has also been a fall in the Real GDP of the industrial sector. Nigeria’s industrial sector output (GDP) dropped from a total of N16.37 trillion in 2015 to a total of N14.3 trillion in 2023.
Without electricity, households may lack access to essential services such as lighting, heating, and cooling, which can affect comfort and safety, especially during extreme weather conditions.
Lack of power supply can also disrupt education. Lack of electricity can hinder educational opportunities, as students may struggle to study after dark or access online resources. Schools may also face challenges in providing quality education without reliable power supply.
Critical healthcare challenges also come with it, as hospitals and medical facilities rely on electricity to power life-saving equipment, refrigerate medicines, and provide essential services. Without electricity, healthcare delivery may be compromised, leading to poorer health outcomes and higher mortality rates.
Limited economic opportunities also happen with lack of electricity and can limit economic opportunities for individuals and communities. Businesses may struggle to operate without power, leading to unemployment, reduced income, and poverty.
For those at the lower end of the spectrum, the struggle for reliable electricity is a daily reality that hampers productivity and quality of life. Addressing this disparity requires a concerted effort to enhance distribution networks, deploying innovative solutions for last-mile connectivity to ensure that every Nigerian can access the power they need to thrive.
The trends in average revenue collection, and supply per customer reveal areas of need for future improvements. As Nigeria’s DISCOS continue to navigate the complex energy landscape, their success will hinge on their ability to innovate, invest, and deliver quality service to all Nigerians.
In the end, the performance of Nigeria’s Electricity Distribution Companies in the last decade is a narrative on a nation’s drive towards an energy-sufficient work and life. It’s one that will continue to unfold, with each kilowatt-hour distributed and every Naira collected contributing to the nation’s journey towards sustainable development and prosperity for all its citizens.
Addressing these factors, governments, businesses, and communities can work towards fostering sustainable industrialization and improving quality of life.
This story was generated by Nubia AI platform and moderated by Oluwasegun Abidoye