Energy consuming 40% of our cost, says MAN

<p>The Manufacturers Association of Nigeria has said its members are currently spending between 35 per cent to 40 per cent of total costs on energy needs.</p>, <p>President, MAN, Francis Meshioye, stated this during an exclusive interview with The PUNCH.</p>, <p>According to him, any increase in energy costs such as electricity tariff or fuel price hike increases their cost.</p>, <p>Meshioye said, “We rejected the hike in electricity tariff because, in the first instance, energy cost is very high for manufacturers, particularly those who consume much like steel manufacturers.</p>, <p>“It takes an average of 35 to 40 per cent of their total costs. Any increase in electricity tariff makes it harder on us. The harder it is, the harder it will be for consumers. When this is so, it means that the demand for products will drop. Like I said in my previous interview, the profit margin will be low.</p>, <p>“The tax that you will have on this margin will be low as well. So the government too, will lose. One thing that I emphasise is that there is a lack of efficiency on the part the discos. They are unable to collect all the money for their supplies. They rely on estimated billing in some cases. This is not good.”</p>, <p>He added, “You cannot tell people that you don’t mind how you collect your money. What they need to do is ensure that all electricity users are metered. It is then that they can say that they know how to get their money.</p>, <p>“They can now make a case to increase their tariff. If that is not done, the increase is not based on an informed decision. The data that they are using is inaccurate. So the decision will be inaccurate.”</p>, <p>Speaking further, Meshioye said exporting manufacturers were currently being challenged by ‘astronomical production costs’ which had kept them from operating at maximum capacity.</p>, <p>Meshioye, who was responding to a question on why manufacturers were unable to step up exports in order to help ease the forex crisis in the economy, said a harsh operating environment, t