While access to reliable electricity can significantly constrain industrial production, little is known as to how unreliability impacts individual-level productivity. This is a particularly salient issue for individuals in developing countries, where electricity provision is still unreliable and self-generation is costly.
Think about the last time you came home from work completely and totally drained. I don’t mean the good kind of tired when you’ve worked hard and gotten something done. I’m talking about exhaustion, coloured by frustration and tinged with anger. Maybe you even felt hopeless. You were fed up, trying to be nice but snapping at family, wanting nothing more than to crawl into bed (or dive into a bottle of wine). If you’re like me, feeling pissed off and hopeless isn’t your natural state. But wait, you need to send a mail, just a single mail. But then Power is out. That alone is likely to increase all pent up emotions exponentially. And then the loud Generator isn’t even an option.
Now imagine this, same emotions, same tasks, the same power-cut, but now something changed. A solar or an inverter box that takes over the power situation when PHCN/IKEDEC takes theirs. Now, that alone guarantees you the completion of the task and not having to listen to the roaring of the generator and leaves you to refresh for the next day. And if you got the information late like me, cheap, affordable and highly maintainable solar and inverter box could be gotten here.
On the production level, we estimate that electricity shortages are a substantial drag on Nigeria manufacturing, reducing output by about five percent. However, productivity effects are smaller, because electricity is a small share of costs, higher-cost self-generation increases energy costs by only about 0.15 to 0.5 percent of revenues, and because most inputs can be stored during outages, the productivity loss is only a fraction of the output loss. This unlike the individual level has the productivity loss cushioned.
The significance of power outage variables suggests that there is a need for the Nigerian government to come up with ways of improving energy generation and supply, as well as proper maintenance of electricity infrastructure in the country. Deliberate efforts by the government to improve power infrastructure will result in the country’s being able to increase electricity production threefold and in turn increase our productivity rate. But right now, this is not even in sight so to complement what we currently have, check here.
In conclusion, the power supply in many African countries is generally known for its unreliability and high disruption costs, thus affecting production efficiency and world-level competitiveness. The problem with Africa’s electricity sector is not that of scarcity, but lack of infrastructure, proper financing mechanisms, and regulations that are important so as to make markets.
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