The Economic Costs of Unsupplied Electricity in Nigeria's Industrial Sector: The Roles of Captive Power Generation and Firm Characteristics

Authors

  • George Abuchi Agwu
  • Iyke Uwazie Uwazie
  • F. Tobechi Agbanike
  • Oguwuike Michael Enyoghasim Department of Economics and Development Studies Federal University, Ndufu-Alike Ikwo (FUNAI) Abakaliki, Ebonyi State Nigeria, West Africa
  • Lasbrey Anochiwa
  • Ikwor Okoroafor Ogbonnaya
  • Chima Nwabugo Durueke

Abstract

Power failure is the most influential business constraint in Nigeria. In this study we pursue answers to two questions concerning policies to mitigate the problem. In the first, we model firms' perception of power failure constraint and found that small and medium enterprises are most constrained. In the second, we examined firms' willingness to pay to avoid power outages and found that on average and ceteris paribus, firms are willing to commit extra 15% of their annual sales to ensure uninterrupted power supply. Furthermore, captive power generating firms are even willing to pay more for uninterrupted power supply. The analysis was based on a sample of 2,676 firms compiled from 2014 World Bank's Enterprise Survey (WBES) for Nigeria. The empirical estimations were based on ordered probit and censored Tobit models respectively. Keywords: Power outages; industrial sector; captive power generation; firmJEL Classifications: L6; D21; C5DOI: https://doi.org/10.32479/ijeep.7681

Downloads

Download data is not yet available.

Author Biography

Oguwuike Michael Enyoghasim, Department of Economics and Development Studies Federal University, Ndufu-Alike Ikwo (FUNAI) Abakaliki, Ebonyi State Nigeria, West Africa

Department of Economics and Development Studies Federal University Ndufu-Alike, Ikwo (FUNAI) Lectuer II

Downloads

Published

2019-04-08

How to Cite

Agwu, G. A., Uwazie, I. U., Agbanike, F. T., Enyoghasim, O. M., Anochiwa, L., Ogbonnaya, I. O., & Durueke, C. N. (2019). The Economic Costs of Unsupplied Electricity in Nigeria’s Industrial Sector: The Roles of Captive Power Generation and Firm Characteristics. International Journal of Energy Economics and Policy, 9(3), 196–204. Retrieved from https://econjournals.com./index.php/ijeep/article/view/7681

Issue

Vol. 9 No. 3 (2019)

Section

Articles

License

Submission of an article implies that the work described has not been published previously , that it is not under consideration for publication elsewhere, that its publication is approved by all authors and tacitly or explicitly by the responsible authorities where the work was carried out, and that, if accepted, will not be published elsewhere in the same form, without the written consent of the Publisher. The Editors reserve the right to edit or otherwise alter all contributions, but authors will receive proofs for approval before publication.