Petrol station managers see drop in sales as power generation steadies

Electricity generation in Nigeria has risen to 4,177.1 megawatts in the last two months.This is a significant improvement from the 3,000 megawatts position about three months ago, and for several months before then.

Even as this (4,77.1 megawatts) threshold is still inadequate for an economy as big as Nigeria’s, its ripple effect is being felt across sectors of the economy.

This is especially so in the petroleum products distribution sector.

Petrol stations in residential and industrial areas are feeling the pinch caused by the improved  power supply.

Already, individuals and firms that use petrol and diesel to power their electricity generators, hardly need to use the appliances and are no longer patronising the filling stations like before because of the improved electricity supply from the national grid.

“The situation is serious, as PMS sales have dropped by about 45 percent” said a petrol station manager in the  densely populated Agege suburb of Lagos.

“I bought five litres of fuel last week and up till now I haven’t exhausted it”, confirmed a resident in the area.

He added that in the months before the improved power supply, he used to buy ten litres of fuel daily for his home generator because there was hardly ever power supply from the grid. “If this is the situation in my own household due to regular supply of electricity, it is the same in other places where power is regular”, he concluded.

Except for the price of petrol which is pegged at N97 per litre, the retail prices of kerosene and diesel have dropped in the last month. Diesel ranges from N142 to N155 per litre. Kerosene that was sold for N150 not too long ago, has dropped to  between N110 and N125 in much of Lagos state. Most vendors admitted the price fall was a response to a significant drop in demand for the product.

Generator sellers are likewise affected. A visit to some of their offices and shops revealed that  sales of  medium- sized petrol and diesel generators have reduced by about 45 percent. The dealers attributed the drop to regular power supply.

Some telecommunications base stations previously powered by generators have started to use solar and other alternative power sources, and this has reduced consumption of diesel by about 50 percent, telecom company engineers told BusinessDay.

However, some hardware traders are already celebrating the improved power supply situation in the country. This is due to a surge in demand for electric cookers and related appliances.  In most of the electronics shops visited, sellers admitted that demand was on the rise for electric cookers in the last few weeks.