Business News of 2014-04-06

‘Dumsor’ boosts generator trade

With the current load-shedding exercise in the country, the sale and supply of generators have become booming ventures for suppliers and retailers who deal in them.

Most businesses are adversely affected each time there is a load-shedding exercise. The situation has led to an increase in generator use by shops in Ghana.

Power outages (dumsor) can disrupt normal activities in a number of ways, ranging from minor annoyances to major problems.

If your home lacks sources of natural light, you might not be able to see clearly without using a candle or flashlight even in the middle of the day.

You might not be able to cook dinner or complete your work assignments as needed. Or worse still, if you rely on electricity to power medical equipment the consequences can be life threatening.

Today, managers of businesses that depend on electric power such as hairdressers, tailors, audio and video media sellers, mobile phone repairers and laundries, all try to grab small or medium-sized generators to enable them stay in business.

Given the wide scope of businesses that are dependent on electrical energy, in periods of power rationing, productivity literally grinds to a halt in the capital. Because these generators create electrical currents through mechanical processes, they depend on noisy, environmentally unfriendly gasoline or diesel-fed engines.

Last Tuesday, The Mirror visited some major businesses in the central business district of Accra to find out how the load shedding was affecting them.

Obviously, shops which usually depend on air conditioners (AC) for ventilation had their doors ajar (with the attendant risks of dust contaminating sensitive wares), while others resorted to powering their lights, fans and ACs with noisy mini-generators, which were in front of their shops; to the detriment of other shop owners, hawkers and buyers.

Most of the generator sellers at Okaishie, Tudu and Opera Square admitted that business was booming for them. And this was evident from the fact that every shop that sold generators had anxious customers examining various models before they buy them.

Some buyers that we chanced upon, however, were negotiating with sellers to buy the generators on credit.

Currently, prices of the generators start from GH¢1,800 for a 2.9 kilovolts-ampere (kVA) generator, while the largest size, which uses 25 gallons of diesel, sells between GH¢2,800 and GH¢4,000, depending on the brands.

Generally, it appears that those that use gasoline are fairly cheaper than the diesel brands. However, with the steady rise in fuel prices, irrespective of the choice of generator, users are assured of daunting operational costs.

As far back as 2007, Accra-based brokerage firm, Databank, reported that businesses were spending the equivalent of $62m a month on alternative sources for electrical energy generation in response to power outages.

In an interview with some of the generator sellers, they disclosed that apart from the increase in demand, there has also been an increase in sales in generator parts.

"As you know, previous power outage periods made many people purchase generators for which they now needed parts for replacements,” a retailer at the Accra Post Office area mentioned. Users, therefore, have to contend with maintenance costs.

It is obvious, therefore, that the price range of generators is way out of league for majority of Ghanaians who live on less than five cedis a day and, therefore, are excluded from the category of people who can afford such gadgets.

Unfortunately, for shop owners who cannot afford a generator, the situation in their shops are so unbearable as their shops look dark and stuffy.

A GTP wax print agent, Adom Abeiku, stated that because the place is usually dark, the customers do not want to enter the shop.

"Sometimes the salesgirls and boys have to stand in front of the shops to persuade potential buyers to enter the dark shops since most of our shops are not very well ventilated," he bemoaned.

He was worried that while hitherto, generators were a source of alternative electricity power supply, they are now the dominant source, as they are considered by their owners to be more trustworthy than the conventional means of electrical energy supply.

It was not surprising, therefore, that some people who spoke to The Mirror expressed the concern that with the unavailability of small to medium-scale generators, many Ghanaians are falling through the cracks in terms of access to basic electricity.

When electricity is provided by public institutions like the Electricity Company of Ghana (ECG), a certain degree of universal access is guaranteed but if citizens are left to their own devices, only a few will have access, and also, the government will be unable to regulate the use of electricity-generating equipment, with the possibility of hazards like pollution, fires and fatal injuries due to misuse.

Source: graphic.com.gh
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