“It is three years now since I was introduced to the use of solar system to power my business, and the business has been growing since then. I now have two shops, said a barber, Efe Obiuwevbi.
Obiuwevbi, whose shops are located at Oju Berger area of Lagos, is one of the beneficiaries of alternative energy source (solar energy) in running Micro, Small and Medium Enterprises (MSMEs) in Nigeria.
“When I was using generator, I made about N25,000 a week after expenses so I will be left with about N13,000, but with solar power, I make over N5,000 daily and that amounts to about N40,000 a week, because there is constant light and it enabled me to introduce other businesses like selling recharge cards as well,” he said.
He said since he stopped running his business on generator due to poor power supply, he has been able to increase his profit and expand his business using solar system.
Experts in the energy sector have lamented that businesses in Nigeria are not maximising their potential in terms of productivity and income generation. The worst hit, according to them, are the MSMEs.
According to SMEDAN and the National Bureau of Statistics, there are over 37 million (Micro -36,994,578; Small – 68,168, and Medium – 4,670) enterprises in Nigeria and they account for more than 84 per cent of jobs in the country.
It is also estimated that MSMEs account for about 48.5 per cent of the country’s gross domestic product (GDP) and about 7.27 per cent of goods and services exported out of the country.
The CEO of Climate Transformation and Energy Remediation Society, Smart Chukwuma Amaefula, lamented that almost all MSMEs powered their businesses with generators in the face of erratic national power supply, saying, “Not only do these SMEs lose income, they are highly and constantly exposed to various health dangers associated with inhaling the fumes from the generators.”
Speaking in Abuja, recently during a workshop tagged ‘The Viability and Affordability of Clean Energy Solutions for Micro, Small and Medium Enterprises in Nigeria’, he said most SMEs do not have reliable access to alternative energy and do not know about it while those that know complain of high cost of diverting to cleaner energy.
“It is clear that not all MSMEs are capable of buying solar systems for their power needs, therefore, there is need to map viable MSMEs that will rely on their turnover and daily energy needs,” he said.
However, a study carried out by the group on pushing off-grid renewable for MSMEs showed that power supply is pivotal to the growth of MSMEs in Nigeria.
The study said power costing more than N40,000 monthly for a micro enterprise lowered the possible income for business owners, adding that it also leaves the small business owners trapped in poverty.
While noting that with the current erratic power supply in the country, finding a reliable, affordable and clean alternative for MSMEs in Nigeria is not only important but exigent.
The study recommended that the Federal Government takes deliberate measures on putting pragmatic policies in place to drive solar penetration for MSMEs in the country.
It said: “The outright cost of solar is still very high, thus, pragmatic policies such as low interest finance, grants, reducing import duty, and local manufacturing of the systems must be put in place to enable small businesses to acquire them.”