Manufacturers on Band A power facing serious trouble – MAN

The Manufacturers Power Development Company Limited, a firm founded under the Manufacturers Association of Nigeria, has said that current energy costs in the country are unsustainable for manufacturing firms, especially those receiving electricity in the Band A category.

To tackle this, the firm revealed that it now provides 10 companies with sustainable energy solutions as part of its effort to bridge the energy gap nationwide.

The acting Managing Director of MPDCL, Oweh Mba-Sam, who disclosed this in Lagos, said working with the 10 companies was the first stage of a broader project aimed at reducing power costs and enhancing energy efficiency for manufacturers.

“If you are on Band A, you know what the cost of power is. Then if you are manufacturing and you are on Band A, you are in serious trouble. And the Manufacturers Association of Nigeria cannot have a power company while members are groaning with Band A,” Mba-Sam asserted, highlighting the urgent need for alternative solutions.

He revealed the MPDCL is leading an initiative to encourage manufacturers to embrace renewable energy, particularly solar to tackle the energy challenge.

The company said it is advocating a “Power as a Service” model, which allows manufacturers to install energy equipment at no initial capital cost, with companies only required to pay an agreed tariff 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 explained.

This model, he added, is critical in helping companies avoid the exorbitant costs associated with getting power from the national grid.

The first phase of the MPDCL project already supports ten companies, each receiving a minimum of 1 MW, representing about 10 MW in total.

Mba-Sam explained that MPDCL’s goal is to systematically bridge Nigeria’s energy gap, aiming to expand the model to more companies across the country.

“The strongest challenging point is finance. Once you get finance, you can do almost everything you want to do. So first we sought finance offshore as single digits. Right now we have 10 companies on our list with a minimum of 1 MW per company. That’s a lot. That’s about 10 MW of the line.

“Our idea is to continue this process until we see the gap start closing until it evaporates,” he added.

President of MAN, Francis Meshioye, further emphasised that the MPDCL’s efforts align with the broader goals of the upcoming Manufacturers Energy Security Summit scheduled for November 19-21 in Lagos.

Meshioye disclosed the summit will bring together industry leaders, policymakers, and energy experts to discuss sustainable energy solutions for industrial growth.

“It is important that we address these challenges frontally,” Meshioye said, noting that the summit will serve as a platform for collaboration between public and private stakeholders.

“By addressing energy security, we can unlock the full potential of our industries,” he added.

Meshioye also called for government support in the form of policy frameworks that can ease access to renewable energy and support energy infrastructure development.

He noted that with Nigeria’s energy supply remaining unreliable and costly, these issues have posed barriers to the competitiveness and growth of local industries.

The summit will focus on various topics, including renewable energy, energy efficiency, and smart manufacturing, with speakers from across the globe expected to share insights on best practices and emerging technologies.

The PUNCH reported that MAN recently amplified advocacy to reduce electricity tariffs for manufacturers, including a lawsuit against the Nigerian Electricity Regulatory Commission and electricity distribution companies which it lost.

MAN said it will continue to call for government intervention regarding the tariffs which rose by 250 per cent following the Federal Government’s policy to increase tariffs for Band A customers from N68/kWh to approximately N224–N225/kWh.