BusinessDay

Agripreneurship and electricity shortage in Nigeria

Agriculture which has long been the backbone of the Nigerian economy employs most of the population, particularly in rural areas.

Agripreneurship, on the other hand, is the establishment of an innovative economic organisation for agricultural expansion or profit in the face of risk and uncertainty. It contributes to various social and economic developments such as employment generation, income generation, poverty reduction, improvement in nutrition, health, and food security.

Electricity is one of the most basic forms of energy for daily use, especially in agricultural products such as heat-generating and agricultural product processing. It is one of the top three most important aspects of basic infrastructure in developing countries.

In agriculture, the utilisation and application of electricity enhance agricultural processes by simplifying large-scale agricultural production, processing, and packaging. It also encourages the growth of agro-allied industries that are part of the agricultural value chain and rely on electricity to operate and maintain their machinery.

In addition, electricity would improve the quality of local agricultural products by allowing modern technology to process and produce farm products such as agricultural cereals and grains. It thus makes it possible to turn perishable farm products like fruits and vegetables into drinks that one can keep for more extended periods without getting spoilt, which is an essential part of value chain development. As a result, these products will be packaged better for proper marketing inside and outside the production domain.

Adequate electricity can thus preserve agricultural products from excessive waste, which could help minimise producers’ losses from product spoiling and encourages entrepreneurs in agricultural businesses.

However, agriculture and electricity actors rarely collaborate to determine which agricultural activities can be electrified and where electrification should be prioritised along the value chain.

Furthermore, the worldwide access to electricity deficit has shrunk from 1.22 billion in 2010 to 759 million in 2019. However, United Nations statistics show that of the 759 million people that do not have access to electricity, 3 out of 4 live in sub-Saharan African countries.

Nigeria, being the largest economy in Sub-Saharan Africa, has abundant oil, gas, hydro, and solar resources, but electricity shortages hamper its progress as existing facilities can create 12,522 MW of electricity. Also, it can only deploy roughly 4,000 MW on most days which is insufficient for a country with over 200 million people.

Read also: Agric growth under Buhari weakest since 1999 despite investment

Although, agricultural commodities in emerging economies benefit from adequate power supply and consumption, which aids economic development and growth. However, the absence of political will for energy sustainability in developing countries such as Nigeria, mainly sustained by agriculture, will hamper ongoing increases in agricultural output.

Thus, the lack of a constant power supply is one of the most pressing issues confronting the economy, preventing further industrialisation and mechanisation of the agricultural process.

Farmers cannot convert their products into a form that may be kept and sold later when favourable market circumstances due to the lack of energy. As a result, this forces many farmers to sell their crops before they rot, which discourages them from taking initiatives to boost farm yields. Due to a lack of electricity, agricultural productivity has been sluggish and hard.

Electrifying agricultural productive uses is thus crucial for ensuring long-term, commercially-driven power supply provision in Nigeria’s rural communities. Therefore, energy generation must be prioritised and aggressively pursued as a priority in the supply of public infrastructure. This provides the agricultural entrepreneurs with sufficient motivation and assistance to begin large-scale production and industrialisation.

Electricity availability has a catalytic influence on farmer incomes and productivity, and it has the potential to change rural economies.

Although, the increase in public expenditure on agriculture has been relatively modest. There have been some structural changes in the agricultural industry, with the mechanisation process rising and energy use to power agricultural machines improving.

The government should further prioritise electricity generation in public budgeting and spending. This is because electricity is similar to the oil that lubricates real sector productivity; it allows industrialisation to improve total more strategic energy policies that are real sector-oriented and will provide the necessary platform for investment and productivity growth.

This implies that as production capacity increases, more commodities and services are produced, leading to a booming and productive economy.

Busayo Aderounmu is an economics lecturer at Covenant University, Ota, Ogun State.

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