Power crisis driving inflation, rising production costs, job losses, advocacy group warns

Consumer rights and electricity sector advocacy group PowerUp Nigeria has blamed the country’s persistent power supply challenges for rising inflation, increasing production costs, and worsening job losses in the manufacturing sector.

The group said Nigeria’s unreliable electricity supply continues to place significant pressure on businesses, forcing many companies to rely on expensive alternative energy sources to sustain operations. According to the organisation, the resulting increase in operating costs is being passed on to consumers through higher prices for goods and services.

Speaking on the state of the power sector, PowerUp Nigeria argued that inadequate electricity supply has become a major obstacle to economic growth, industrial productivity, and job creation. The group noted that manufacturers, particularly small and medium-sized enterprises, face mounting energy expenses that have reduced competitiveness and constrained expansion.

The advocacy group’s concerns align with recent findings by economic analysts and development institutions, which have warned that unreliable power supply remains one of the biggest challenges facing businesses in Nigeria. Reports indicate that many firms depend heavily on generators to compensate for frequent power outages, significantly increasing production costs and reducing profitability.

PowerUp Nigeria further stated that the continued electricity deficit contributes to inflationary pressures across the economy, as higher energy costs affect manufacturing, transportation, and service delivery. The group called for urgent reforms and investments aimed at improving electricity generation, transmission, and distribution to support economic growth and improve living standards.

Nigeria’s manufacturing sector has faced a combination of challenges in recent years, including high energy costs, inflation, foreign exchange volatility, and limited access to affordable financing. Industry reports have linked these factors to business closures and job losses across the sector.

The advocacy group urged policymakers to prioritize sustainable solutions to the power crisis, arguing that a reliable electricity supply is critical to reducing business costs, attracting investment, boosting industrial output, and creating employment opportunities nationwide.