Abuja, Nigeria. 7th April, 2015 – Power poll results released by NOIPolls Limited for the first quarter of 2015 revealed that an average of 62.6 percent of Nigerian households saw no improvement in power supply to their households (from Q1 2013-Q1 2015); leaving only 37.4 percent who said they saw some improvement. This implies that for a period of two years of monitoring trends in the power sector, there has been no remarkable improvement in power supply, as the larger proportion of Nigerians did not see any improvement in power supply to their households. In line with this finding, the South-West region had the highest average proportion (67 percent) and the South-East region had the lowest average proportion (56 percent) of respondents who saw no improvement in power supply to their households.
More findings revealed that over the same period, Nigerian households received an average daily cumulative power supply of between 5.4 – 7.1 hours per day. These findings highlight the existence of certain inherent issues in the nation’s power generation, transmission and distribution value chain. As a result, the direct effect of these issues can generally be seen in the widespread purchase and use of alternative sources of power (such as generators, inverters, and solar installations etc) by a high percentage of Nigerians (average of 77.5 percent). This has also impacted on the spending of Nigerians on power supply; as these alternative sources are typically more expensive to run than direct power supply from DISCOs.
An evaluation of expenditure of Nigerians on actual power supply from Distribution companies (DISCOs); as well as expenditure on alternative sources, revealed that on the average (between Q2 2014 and Q1 2015) Nigerians spent between ₦3,302 – ₦3,613 on actual power supply from DISCOs and between ₦ 8,321 – ₦ 11,198 on alternative sources of power. This therefore brings the average total monthly expenditure on power to between ₦ 11,623 – ₦ 14,811. This finding throws light on some challenges Nigerians (especially low income earners) may be facing in the distribution of household consumption-expenditure; giving that the average income for Nigerians in this category ranges from ₦ 5,000 – ₦ 40,000 [1]
Finally, while the demand for power continues to increase even with the rise in population, access to power and the ability to meet this demand is highly important in enhancing household and business activities, as well as driving development in Nigeria. This in turn would depend greatly on the successful reform of the power sector with clearly outlined strategies which are time bound and incorporates diversification in power generation for the nation through other available sources. These were some of the key findings from the power polls conducted from Q1 2013 to Q1 2015.
Brief background
The power sector in Nigeria has been beset with numerous challenges manifesting in poor power supply to the final consumer. Since the privatization of the Power Holding Company of Nigeria Plc. (PHCN) in 2013, Nigeria’s electricity generation capacity has declined from the peak generation of about 4,517.6 megawatts (MW) in December 2012 to about 3,670 MW in January 2014.[2] This occurred in a period when the forecast for electricity generation was placed at 12,800MW. On a per capita consumption analysis, Nigeria is ranked a paltry 178th with 106.21 KWh per head, behind other African countries like Gabon and Ghana.[3]
The reasons for the gulf in supply-demand range from: old dilapidated plants (at least 80 percent are over 10 years old)[4]; challenges with access to funds by organizations that recently acquired PHCN subsidiaries[5]; and poor gas supply to power generating plants[6]. Furthermore, setting prices for consumers that promote efficient use of electricity is a challenge as costs vary across times of day (peak/off-peak), seasons (dry/rainy), users (commercial/residential), and geographic areas (urban/rural). Electricity prices in Nigeria are below production costs, therefore the industry is unable to generate enough revenue to cover its operating costs.[7]
With the aim of monitoring the progress made so far in the power sector reforms in Nigeria, NOIPolls introduced the Power Polls in 2013 to explore the perception of Nigerians towards the power sector reforms. The polls were conducted monthly to explore the amount of power supply received daily and expenditure on power supply, as well as the state of power supply to households and its effect to consumers especially in the use of alternative sources of power and its financial implications. The results from the polls are presented in quarters from Q1 2013 to Q1 2015.
Key Findings
Consumers’ Description of the State of Power Supply to Their Hosueholds
In conducting the power polls, Nigerians were asked 5 specific questions every month, 4 of these questions would be discussed in this release. Firstly Nigerians were asked to describe power in their area over the past month. Results obtained since 2013 revealed an average of 37.4 percent saw improvement in power supply to their households implying that the larger proportion of Nigerians saw no improvement in power supply to their households.
Results also revealed that on an average, the proportion of Nigerians who saw improvement in power supply in their area declined steadily since quarter three of 2014, from its value of 45 percent then to 33 percent in Q1, 2015. This becomes even more interesting when we note that in the preceding quarter – i.e. Q2, 2014 – recorded the largest increase in the proportion of Nigerians who disclosed that power supply improved in their area.
Figure 1: Proportion of Nigerians who feel power has improved, and declined (Q1, 2013 – Q1, 2015)
When the proportion of Nigerians who experienced improvement was analyzed by geo-political zones, it was found that the South-East zone recorded the highest proportion of residents in Q1, 2015 (43 percent) who saw improvement in power to their households
When the proportion of residents who disclosed power had improved in their area was averaged over the period Q1, 2013 through Q1, 2015, we found the South-East region had the highest average proportion (42 percent) and the South-West region had the lowest average proportion (33 percent).
Cumulative Hours of Power Supply Recieved by Consumers Daily
To evaluate the daily quantity of power supply received by Nigerian households in hours, respondents were asked, “On the average, how many hours of cumulative power supply do you have in a day?” Generally, over the period Q2, 2013 to Q1, 2015, Nigerians revealed that they received an average cumulative power supply of 5.4 – 7.1 hours per day. The longest period of cumulative power supply in the aforementioned period, according to respondents, was 7.1 hours per day, which is well below half the duration of one day.
Interestingly, the average hours of power supply per day witnessed the largest increase over the period Q2, 2014 – Q3, 2014; however a steady decline was observed between Q3, 2014 – Q1, 2015, similar to the chart above.
Average Monthly Expenditure on Direct Power Supply
Respondents disclosed how much they spend monthly on electricity. It is important to note here that these costs do not include operational costs for generators, inverters, or other alternative sources of electricity, but strictly measures the cost of electricity supply from the Distributing Companies (DISCOs) on the consumer side. On average between Q2, 2014 and Q1, 2015 Nigerians spent between ₦3,302 – ₦3,613. The first quarter of 2015 marked the largest average expenditure nationwide by consumers on electricity, ₦3,613.
Average Expenditure on Alternative Sources of Power
As a direct effect of the poor state of power due to interruptions in supply to households, a large proportion of Nigerians have adapted the use of alternative sources of power (e.g. generators, inverters, etc.) to augment their power supply.
The use of alternative sources to augment actual power generally affect the overall monthly spending of Nigerians on power, to measure this, respondents were asked how much they spend monthly on alternative sources of power. Within the period Q2, 2014 and Q1 2015, average expenditure on alternative sources of power was within the range of ₦ 8,321 – ₦ 11,198, with Q2, 2014 recording the highest expenditure on alternative sources of power, and Q4, 2014 recording the lowest within the period of observation.
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In conclusion, results from the power polls conducted from Q1 2013 to Q1 2015 revealed that an average of 37.4 percent of Nigerian households saw improvement in power supply to their households implying that the larger proportion of Nigerians saw no improvement in power supply to their households. When the proportion of residents who disclosed power had improved in their area was averaged over the period Q1, 2013 through Q1, 2015, the South-East region had the highest average proportion (42 percent) and the South-West region had the lowest average proportion (33 percent). In addition, over the period Q2, 2013 to Q1, 2015, Nigerians received an average cumulative power supply of 5.4 – 7.1 hours per day.
More findings revealed that on average between Q2, 2014 and Q1, 2015 Nigerians spent between ₦3,302 – ₦3,613. The first quarter of 2015 marked the largest average expenditure nationwide by consumers on electricity, ₦3,613. Finally, within the period Q2, 2014 and Q1 2015, average expenditure on alternative sources of power was within the range of ₦ 8,321 – ₦ 11,198, with Q2, 2014 recording the highest expenditure on alternative sources of power, and Q4, 2014 recording the lowest within the period of observation.
Survey Methods
The opinion poll was conducted between January 2013 and March 2015. It involved telephone interviews of a random nationwide sample. 27,000 randomly selected phone-owning Nigerians aged 18 years and above, representing the six geopolitical zones in the country, were interviewed. With a sample of this size, we can say with 95 percent confidence that the results obtained are statistically precise – within a range of plus or minus 1 percent. NOIPolls Limited, No1 for country specific polling services in West Africa, works in technical partnership with the Gallup Organisation (USA). We conduct periodic opinion polls and studies on various socio-economic and political issues in Nigeria. More information is available at www.noi-polls.com
Disclaimer
This press release has been produced by NOIPolls Limited to provide information on all issues which form the subject matter of the document. Kindly note that while we are willing to share results from our polls with the general public, we only request that NOIPolls be acknowledged as author whenever and wherever our poll results are used, cited or published.
NOIPolls hereby certifies that all the views expressed in this document accurately reflect its views of respondents surveyed for the poll, and background information is based on information from various sources that it believes are reliable; however, no representation is made that it is accurate or complete. Whilst reasonable care has been taken in preparing this document, no responsibility or liability is accepted for errors or fact or for any views expressed herein by NOIPolls for actions taken as a result of information provided in this report. Any ratings, forecasts, estimates, opinions or views herein constitute a judgment as at the date of this document. If the date of this document is not current, the views and content may not reflect NOIPolls’ current findings and/or thinking.
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[1]http://www.efina.org.ng/assets/Documents/EFInA_Understanding%20the%20Low%20Income%20Population%20in%20Nigeria_%20FGD%20Study_March%202011.pdf?phpMyAdmin=%2CWvBxPNpx0z2BcKe8h2UcHJI%2CXb[1]
[2] Joseph, I.O. 2014. “Issues and challenges in the Privatized Power Sector in Nigeria.” Journal of Sustainable Development Studies 6(1): 161-174.
[3] Anyanrouh, F. 2013. “The Challenges of the Nigerian electric power reform” Vanguard. http://www.vanguardngr.com/2013/02/the-challenges-of-the-nigerianelectric-power-sector-reform-1/
[4] Adenikinju, A.F. 2003. Electric Infrastructure failures in Nigeria: A survey based analysis of the costs and adjustment responses.
[5] Nnodim,O. 2014. “Power distribution firms owe government – NERC.” Punch. http://www.punchng.com/business/business-economy/power-distribution- firmsowe-govt-nerc/
[6] Joseph, I.O. 2014. “Issues and challenges in the Privatized Power Sector in Nigeria.” Journal of Sustainable Development Studies 6(1): 161-174.
[7] Joseph, I.O. 2014. “Issues and challenges in the Privatized Power Sector in Nigeria.” Journal of Sustainable Development Studies 6(1): 161-174
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