IMPACT OF POWER SUPPLY ON THE PERFORMANCE AND GROWTH OF SMES: EVIDENCE FROM SELECTED FIRMS IN ENUGU STATE

BY

ODIHEKANDU NKEMJIKA

Author Note

I have no conflict of interest to disclose.

Correspondence concerning this article should be addressed to Odihekandu Nkemjika. Email: onkemjika@gmail.com.

Abstract

This research looks at the impact of power supply on the performance and growth of Small and Medium Enterprises (SMEs) with evidence from selected firms in Enugu State, Nigeria. Enugu State comprises 17 Local Government Areas (LGAs) across three senatorial districts, with a SMEs base of 1,366. For this study, data were collected from 270 SMEs across six LGAs with the highest SME density, which include Enugu North, Udenu, Udi, Enugu South, Awgu, and Nsukka, representing all three senatorial districts. Descriptive statistics and chi-square tests were used to assess the relationship between power supply adequacy and SMEs’ performance and growth. Findings reveal that power supply is largely inadequate in the region, with frequent outages forcing SMEs to rely on generators and solar systems. Despite these adaptations, 50% of respondents reported negative effects on business performance, particularly in production, operational costs, and sales. Furthermore, SMEs with adequate power supply were significantly more likely to report high performance and experience business growth, including increased revenue, expansion, and staff employment. The study concludes that reliable electricity is vital for SME success and recommends infrastructure investment, energy support initiatives, and hybrid power solutions to enhance resilience and drive regional development.

Keyword: Power supply, SME performance, business growth, electricity infrastructure, Enugu State.