For a long time, I treated power outages as just another part of running a business in Nigeria.
When the electricity went off, I switched on the generator. When the generator ran out of fuel, I bought more. When the generator needed servicing, I paid for the repair. Then I went back to work.
I rarely stopped to calculate how much all of this was actually costing my shop every month.
Like many small business owners, I was more focused on sales, customers, stock and rent. Generator fuel was simply another expense that had to be paid.
But when I finally decided to put the numbers together, I realised something important.
The cost of unreliable electricity was much higher than the amount I was spending at the filling station.
There was the fuel itself, but there were also generator repairs, engine oil, maintenance, equipment wear, spoiled goods, interrupted transactions and hours spent dealing with power-related problems.
So I decided to look at the cost from a different perspective.
Instead of asking, "How much did I spend on fuel this month?" I asked, "How much did unreliable electricity really cost my business?"
The answer was eye-opening.
My Shop's Typical Power Situation
My shop is a small retail business that depends on electricity for several everyday activities.
I need power for lighting, charging phones, operating electronic devices, keeping certain products cold and processing customer payments. None of these things sounds particularly complicated, but they become difficult when electricity is unavailable for long periods.
On a typical day, I might get only a few hours of public electricity.
The exact number varies. Some days are better than others, while there are days when the power supply is practically useless for the business.
My shop typically receives approximately 5 hours of public electricity per day.
That leaves about 19 hours when electricity would have to come from another source if the business wants to continue operating normally.
Of course, I do not run the generator for all 19 hours.
That would be extremely expensive.
Instead, I make decisions based on what is happening in the shop. If customers are coming in, the generator may need to run. If there is little business activity, I may switch it off. If there is something that must remain powered, I may keep it running for that purpose.
This is where the cost of unreliable electricity becomes complicated.
The business owner is constantly making small decisions about whether a particular hour of electricity is worth paying for.
The First Cost: Generator Fuel
Fuel is usually the most obvious cost.
For a small petrol generator, fuel consumption depends on the size and condition of the generator, the electrical load and how long it runs.
My generator consumes an average of 1.2 litres of petrol per hour under the shop's normal load.
If I run it for an average of 8 hours per day, that is:
1.2 litres × 8 hours = 9.6 litres per day
Over 30 days:
9.6 litres × 30 = 288 litres
If petrol costs ₦1,000 per litre, the monthly fuel cost would be:
288 × ₦1,000 = ₦288,000
That is already a significant amount of money.
And this is only fuel.
It does not include the cost of maintaining the generator or replacing parts when something goes wrong.
Fuel prices also change, so the actual amount a business spends can be very different from one month to another.
For that reason, I think it is useful to track litres purchased as well as the amount of money spent.
If you only record the naira amount, it can be difficult to understand whether your generator is becoming more efficient or whether you are simply paying more because fuel has become more expensive.
Generator Maintenance Is Another Expense
Generators are machines, and machines require maintenance.
Oil needs to be changed. Spark plugs can wear out. Filters become dirty. Batteries can fail. Belts and other components may eventually need replacement.
Sometimes the generator runs perfectly for several weeks.
Then something happens.
The engine starts behaving strangely. It becomes difficult to start. It produces unusual sounds. It switches off unexpectedly.
A small problem can become a bigger problem if it is ignored.
For a business, generator maintenance is not just about protecting the machine. It is also about avoiding unexpected downtime.
I spend ₦25,000 on servicing and minor repairs during a particular month.
That means the monthly electricity cost is already higher than the fuel bill alone.
There is another way to think about this cost.
If a generator costs ₦500,000 and I expect it to remain useful for about five years, the machine itself is being consumed over time.
Five years is 60 months.
₦500,000 ÷ 60 = approximately ₦8,333 per month
This is not a cash payment I make every month, but it is still useful when calculating the real cost of depending on the generator.
The generator is an asset, but it also loses value as it is used.
Engine Oil and Small Repairs Add Up
One of the easiest expenses to forget is the collection of small maintenance costs.
A business owner might spend ₦5,000 on oil one week, ₦3,000 on a minor part another week and another amount on servicing later.
None of these payments feels enormous on its own.
But when they are added together over a year, they can become substantial.
The shop spends an average of ₦10,000 per month on engine oil, spark plugs, filters and minor generator-related parts.
That is:
₦10,000 × 12 = ₦120,000 per year
Again, this is money that would not have been necessary, or at least would have been significantly lower, if the business had reliable electricity.
My Monthly Electricity Cost
Using the figures above, we can do a simple calculation
| Expense | Monthly Cost |
|---|---|
| Petrol | ₦288,000 |
| Generator servicing and repairs | ₦25,000 |
| Engine oil and minor parts | ₦10,000 |
| Generator depreciation | ₦8,333 |
| Estimated total | ₦331,333 |
That means the shop is effectively spending about ₦331,333 per month to keep its business powered.
That works out to approximately:
₦331,333 ÷ 30 = ₦11,044 per day
This is an important number.
It means the business needs to generate more than ₦11,000 every day simply to cover these power-related costs.
And remember, this is before paying rent, buying stock, paying workers, paying for transportation, replacing equipment or making a profit.
But the Fuel Bill Is Not the Whole Story
This is where my thinking about electricity changed.
The direct expenses are easy to see.
I can look at a receipt and know how much I spent on fuel.
I can look at a mechanic's invoice and know how much a repair cost.
But some of the biggest costs do not appear on any receipt.
They come from what happens when the power is unavailable.
Lost Sales During Downtime
Imagine a customer walks into the shop and wants to buy something.
The customer is ready to pay.
But there is no electricity, the generator is off and the payment device is not working properly.
The customer says they will come back later.
Maybe they do.
Maybe they don't.
That sale has now become uncertain.
My shop makes ₦40,000 in sales during a particular four-hour period.
If the generator develops a problem and the shop cannot operate properly during those four hours, some of those sales may disappear.
It would be wrong to say that every naira of that ₦40,000 is automatically a loss because customers may return later.
But if even 25 percent of those expected sales disappear, that represents:
₦40,000 × 25% = ₦10,000
Now imagine something similar happening several times during a month.
The cost becomes noticeable.
This is why looking only at generator fuel does not tell the whole story.
Payment Problems Can Cost Customers
Electricity problems can also affect how customers pay.
Many businesses now depend on electronic payments.
Customers may want to pay through a POS terminal, transfer money using their phone or use another digital payment method.
When the equipment is not powered, the network router is down or a device cannot function properly, a simple purchase can become frustrating.
Sometimes the customer will wait.
Sometimes they will try another payment method.
And sometimes they will simply leave.
Even if the actual number of lost transactions is small, the effect can become meaningful over time.
Imagine that five customers each month abandon purchases worth ₦5,000 because of payment or electricity problems.
That would represent:
5 × ₦5,000 = ₦25,000
The important lesson is that businesses should track these incidents rather than assume they are insignificant.
Spoiled or Damaged Products
Some retail businesses have another problem that can be even more expensive.
Perishable goods depend on refrigeration.
When electricity goes off, the refrigerator or freezer may stop working.
A generator can solve the problem, but only if there is enough fuel and the generator is functioning.
If the generator stays off for too long, certain products may become damaged or spoil.
I lost ₦15,000 worth of products during one extended outage.
That loss is different from buying fuel.
The fuel keeps the business running, while the spoiled products represent stock that was purchased but can no longer generate revenue.
If this happens several times in a year, the total can become substantial.
Businesses selling food, drinks, frozen products and other temperature-sensitive goods need to pay particular attention to this.
There Is Also a Cost to My Time
This is probably one of the costs business owners overlook most often.
Running a generator takes time.
Someone has to buy fuel.
Someone has to check the oil.
Someone has to start and stop the machine.
Someone has to call a technician when it develops a problem.
Sometimes you have to leave the shop to look for fuel or find someone who can repair the generator.
That time could have been spent serving customers, buying stock, managing the business or resting.
I spend just 30 minutes a day dealing with power-related tasks.
Over 30 days, that becomes:
30 minutes × 30 days = 900 minutes
That is 15 hours per month.
Fifteen hours is almost two full working days.
The time may not appear in my accounting records, but it still has value.
The Real Monthly Picture
If we combine the direct costs, the picture becomes clearer.
| Category | Monthly Cost |
|---|---|
| Generator fuel | ₦288,000 |
| Maintenance and repairs | ₦25,000 |
| Oil and minor parts | ₦10,000 |
| Generator depreciation | ₦8,333 |
| Spoiled or damaged products | ₦15,000 |
| Estimated lost sales | ₦25,000 |
| Payment-related lost sales | ₦25,000 |
| Estimated total impact | ₦396,333 |
That is nearly ₦400,000 in one month.
A larger shop with heavier equipment could spend much more.
A business that operates fewer hours or uses a smaller generator could spend less.
The point is not that every Nigerian business loses ₦396,333 every month.
The point is that the actual cost of unreliable electricity can be much higher than the fuel bill suggests.
What I Would Do Differently
Once I started looking at electricity as a business expense rather than just an inconvenience, I began thinking differently about alternatives.
The first thing I would compare is the cost of generator power with the cost of another backup option.
A business might consider an inverter and battery system.
That does not automatically mean it is the better choice.
The equipment has an upfront cost, batteries eventually need replacement and the system needs to be properly sized for the appliances it will power.
But if a business is spending hundreds of thousands of naira every month on generator operation, the calculation becomes worth doing.
The same applies to solar power.
Solar equipment can be expensive to install, but it may reduce the amount of fuel required during the day.
The right solution depends on the business.
A small shop with lights, phones and a few low-power devices has very different requirements from a business running freezers, air conditioners and other heavy equipment.
I Would Also Change How I Price Products
Power costs should not be treated as if they do not exist.
If a business spends a large amount of money generating electricity, that expense is part of the cost of operating the business.
This does not mean randomly increasing prices whenever the generator consumes fuel.
It means understanding the business's total operating costs.
If electricity, transportation, rent, staff wages and other expenses are increasing, the business owner needs to know how much each expense contributes to the final cost of doing business.
Without knowing those numbers, it is easy to think that sales are increasing while actual profit is falling.
The Simple Exercise Every Shop Owner Can Do
You do not need expensive accounting software to calculate the cost of power problems.
Start with one month.
Write down every fuel purchase.
Record every generator repair.
Record oil changes and replacement parts.
Write down every day when the shop experienced significant downtime.
If products were spoiled because of an outage, record their value.
If customers left because payment systems were unavailable, estimate the value of those transactions separately.
At the end of the month, add everything together.
You can use a simple table like this:
| Expense or Loss | Amount |
|---|---|
| Fuel | ₦_____ |
| Repairs | ₦_____ |
| Oil and parts | ₦_____ |
| Generator depreciation | ₦_____ |
| Spoiled goods | ₦_____ |
| Estimated lost sales | ₦_____ |
| Payment-related losses | ₦_____ |
| Total | ₦_____ |
Then compare that number with your monthly revenue.
If the total electricity-related cost is ₦300,000 and your monthly revenue is ₦2,000,000:
₦300,000 ÷ ₦2,000,000 × 100 = 15%
That means electricity-related costs and losses are equivalent to 15 percent of your revenue.
That is no longer a small inconvenience.
It is a major business expense.
The Bottom Line
For years, I thought of power outages as something Nigerian business owners simply had to tolerate.
There is certainly a reality to that. Businesses need to find ways to keep operating even when public electricity is unreliable.
But accepting the situation does not mean ignoring its financial impact.
The real cost is not just the money spent buying petrol.
It includes generator maintenance, equipment depreciation, spoiled products, interrupted payments, lost customers, downtime and the owner's time.
Once all of those costs are put together, the number can be surprisingly large.
The most useful lesson for me is simple: if you do not measure the cost of power problems, you may underestimate how much they are affecting your business.
I would recommend that any small business owner track these expenses for at least one month.
Do not guess.
Write down every fuel purchase. Record every repair. Track downtime. Note spoiled goods and missed sales.
At the end of the month, add everything together.
The result may change how you think about your generator, your pricing, your inventory and even your plans for investing in alternative power.
Electricity may feel like a background issue when you are busy running a shop.
But when you put the numbers on paper, you may discover that it is one of the biggest costs your business is carrying.