• Thursday, March 28, 2024
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‘Renewable energy is best alternative source to tackle Nigeria’s massive energy deficit’

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ZOLA Electric is strategically positioned to provide solutions to the power sector problems in Nigeria. In this interview with KELECHI EWUZIE, Bill Lenihan, Chief Executive Officer, explains the power solutions they offer customers and their future plans to ensure 24- hour reliable power supply. Excerpts:

ZOLA Electric is entering into Nigeria at a time when we have issues with energy access. What solutions are you offering and what are the implications to Nigeria?

I think the problem in Nigeria is that there is not enough production and distribution of power for the population in the country. I think Nigeria is a perfect example of a country where there is massive energy deficit. Everybody living in Nigeria has this issue; every business has this issue. So, the question is what happens when people are having problem with energy or what happens where that exists? It means people have to come up with their own energy.

It means if you are a household, you are probably buying kerosene to light up a lantern or you get solar battery to attend to your power needs, but if you are urban, you are either thinking of buying diesel generator or a lead acid inverter system.

The energy crisis also forces you to change appliances constantly, or sometimes force you to do an upgrade. Beyond that, you also have these alternative sources causing health hazards and noise pollution. In a nutshell, I would say that you have a system that is unreliable, expensive and hard on your life. So, for us, that is the problem we have come to solve.

At ZOLA Electric, our mission is to deliver 24-hour power to anyone, anywhere. Our product offerings such as Infinity and Flex allow us to do that and these products are tied towards meeting that need.

This system has been designed to provide solar storage that looks like computer such that the computer allows you to optimise production and discharge system. With such a solution which has something similar to a computer attached to it, you can actually pay over the phone or through refinancing. Let me also add that the product is more marginal. Whenever you need more energy, the product allows you to get more energy without affecting the existing system which is different from what you have in the market today. If you want to generate more power, the solution can help you. It is smart and comes at low cost. If your energy needs are more powerful, say you run a business or factory,  even though you have small power needs but rely on the grid, there is a product designed for that purpose and it is called Infinity, which better serves that need. Only recently, we announced that we would be bringing the product into the market.

Now, think of Infinity like a smart grid in the home. It is a product that is also connected to all other energy sources; it is connected to the grid, connected to e-solar. The first thing it does is that it optimises the ecosystem to deliver 24-hour power at reliable low cost.

How does it work? It does it in a subtle way. What it does is that it optimises your accessories such that you get a 24-hour power in an affordable way. Also, it is modular. As soon as you need more energy, you get it and it is done in a very seamless fashion that is cost-effective. Here, the existing system stays intact; you are not changing it.

It is a system that allows you to manage power usage using your phone app. It allows you to manage your energy provision in a very simple way on your phone. You can make it smarter so that it optimises better. You can pay for it using your phone and we would offer that service under a 5-year service agreement. Within the five years, if there are any issues, we would fix it for you. From Flex to Infinity in emerging markets like Nigeria, we are offering a primary power source, unlike what you have presently where everything you do to get power involves back-up which is unreliable and expensive. Our products are more reliable, cheaper and easy to use. For us, we believe that is the best way to solve the problem of energy access in Nigeria.

When developing the products, you had Lagos in mind. What informed that and why are you interested in the Lagos market?

Lagos, like Nigeria, is the epicenter of the energy access crisis across the globe. There is not one person, or business in Nigeria, that is not confronted with this crisis. Unfortunately, Lagos is one large city that has suffered much energy crisis, considering its huge location of businesses and massive population.

With what is on ground, the problem is only going to get worse. We talked about Nigeria for a number of years in every of our board meetings. In the last two or three years, we have been asking what do we do about Nigeria. We were never ready to provide products that we can tailor towards Nigeria until we came up with Infinity. Also, we never had a business model that was built towards Nigeria.  But in the last two years, we have placed our focus on what the problem is in Nigeria as far as energy access crisis is concerned. Our focus on Lagos was not only because it is huge and urban but we realised that it is a city that harbours every type of person, business. So, if you are really going to solve the energy problem holistically, Lagos is a place to start with.

How do you intend to deploy the solution especially to those who are not within Lagos? What is the capacity and cost of these solutions in terms of megawatt?

I think you are right by saying that Lagos still has better access compared with states in Nigeria. But let me say that because you are connected to the grid does not mean you have reliable energy source. We view Lagos as a market opportunity for us because everybody there has some form of energy challenge. So, for us, how we launch in other parts of Africa where we have presence is the same way in which we would launch across Nigeria. We are kick-starting in Lagos and thereafter we would broaden our presence in Nigeria. We would launch in Lagos and have some centres that would allow us to sell to you whatever your need is, wherever you are. Nigeria is a massive market. Lagos is a massive market. We start from regions and grow from there. Take for instance, in Tanzania, we started from the capital city and moved to the regions and that is the strategy we would be adopting in Nigeria.

Let me correct the notion that that there are similar solutions being offered in Nigeria. I don’t think there is any one that offers our kind of solution. Currently, what we have in Nigeria is a situation whereby some companies provide solar panel with battery but I don’t think there is anyone that offers our solution. In this case, you can buy solar or battery but you cannot buy a solution. In the solution we are providing, you are buying a primary energy source that can manage your ecosystem as far as energy is concerned. It is marginal and can grow with you. It is smart, connected and reliable. This is what differentiates these products in Nigeria’s marketplace today.

With respect to the question on capacity, I think there is a reason why it is called infinity. It is modular and scalable. You can expand it to whatever you want to.

Are you looking at working with the Federal Government to assist individuals generate electricity and take it back to the grid and consequently get compensated for it?

We have 200, 000 solar energy devices across Africa. We will soon have solar energy devices that are smart and connected. There is an opportunity for us to work together and we would both benefit. There is an opportunity to provide great services to the grid. We can provide local production, local storage and local control. We will provide such services and the consumers get compensated. Once there is an ecosystem to manage such transactions, we are ready. Yes, we are absolutely open to such an opportunity that rewards consumers while also improving distribution of power in the country

Considering the level of income disparities in Nigeria in relation to the price, do you think the product is pocket-friendly and affordable?

I think the answer is yes. I do believe the product is pocket- friendly and affordable. For us, we develop a product line that meets energy use need with an affordable price point, although it may not be easy to find an entry point in terms of pricing in this energy ladder. It is not a one-size-fits all kind of pricing for the solutions. Everything is basically dependent on what you need. We have developed it in such a way that consumers can use their savings to purchase the solution. It is not something that is far beyond reach for electricity consumers. So, as we speak, we already have some local partners such as banks who have shown interest in making the payment a lot easier for those who want to buy the solution.

What is the volume of investment we are looking at with the introduction of these solutions into Nigeria or how much is ZOLA Electric spending to facilitate this solution in Nigeria?

Having established a strong presence in Africa, what I can say is that we are investing hugely in this market because we have we have pretty strong investors involved in this. We have Helios capital, which is arguably the largest private equity firm in Africa. Our second-largest shareholder is Tesla. We also have GDO, the largest electricity generator in the world- a French utility. We have Total- one of the major energy companies in the world. In a nutshell, we have strong investors with deep pockets but they are also smarter. They are interested in things that will deliver right returns, grow and be successful. My belief is that if we can execute and prove that we have the best solution, they would be more interested in putting additional capital. Conservatively, I can say that we are looking at investing billions of dollars in Nigeria. We have a solution that works and we believe we would improve the energy market in Nigeria.