Nigeria's ongoing energy crisis continues to cripple its economy, with an estimated annual loss of $26 billion, according to a new report from Standard Chartered.

In its latest Africa Trade Barometer report, Standard Bank identified electricity supply as a major obstacle to business operations in Nigeria and other African markets.

The report also states that businesses in the country spend around $22 billion a year on off-grid fuel to offset the impact of unreliable electricity, which further increases operational costs.

“In Nigeria, the companies surveyed face a national network that frequently collapses as it is unable to meet daily peak demand that is nearly four times greater than its production capacity,” the report reads.

“Economic losses resulting from power shortages in Nigeria are estimated at $26 billion per year, not including fuel expenses for off-grid generators, which are estimated at an additional $22 billion.

According to the report, power outages disrupt production, compromise the quality of temperature-sensitive products, disrupt water supplies, and affect telecommunications infrastructure critical to payment systems.

According to the bank, these disruptions are causing a reduction in business sales and revenue.

To meet the challenges associated with this situation, the report highlights the need to diversify the energy mix in order to reduce dependence on the national grid.

Standard Bank has also called for policy interventions to stabilize power generation and attract investments in renewable energy solutions.

In the report, Standard Bank pointed out that Nigeria experienced the largest drop in business confidence among businesses surveyed in Africa.