Pains, gains of alternative sources of power
Protracted power problems force Nigerians to explore other sources of electricity. But FOLASHADE ADEBAYO writes that there are still hurdles to cross
Day and night, Vicas Hospital, Government Reservation Area, Kaduna, used to be a theatre of roaring noises. During daily episodes of power outages, patients were examined and they recuperated against the grinding background noise from a 60KVA generator. However little, their medical bill also reflected the diesel burden which the Medical Director, Dr. Emmanuel George, puts at N100,000 monthly.
But with the acquisition of a 10KVA power inverter at the northern Kaduna hospital in 2009, it is a new day for the doctors and their patients alike. George, who also invested in a 5KVA inverter for his household, tells our correspondent about the light and calm that his hospital now experiences.
He says, “I must have spent close to N5m on the two inverters. The 10KVA at the hospital uses 24 batteries while the 5KVA in my house uses 12. I spend about N1m each time I change the batteries. So I must have invested N8m on inverters. But I am not complaining as there is nothing electrical that I cannot power in my hospital and also at home. In fact, you don’t even know there is no light from PHCN because there is light all the time.
“That was also the case when I was using generators. I had a 60KVA generator and a 35 KVA at home. I could power everything in the hospital conveniently but it was not cost-effective. I was spending N100,000 every month, buying diesel. You also have to think about the maintenance and the noise in a medical environment,’’ he says.
A civil servant, Fidelis Eze, is in the same boat with George. Before ditching his 7.5KVA generator for an inverter a year ago, Eze had coped with the ubiquitous noise and an expanding hole in the family budget. In those days, he notes, he spent at least N30,000 monthly to power his generator and another N10,000 for maintenance every quarter. Obviously, his efforts were not enough as he still had to depend on the PHCN, to use his refrigerator and pump water for his household.
Though nothing dramatic has changed in his take home package, the desire to have a stable, cost-effective and high-capacity alternative power supply is primary. For him, a 5KVA inverter is a worthy investment.
“It is a huge investment for me. I spent about N400,000 buying my inverter, connecting wires and four batteries. What can one do in a country like this? Aside from environmental pollution, it was too expensive buying diesel for my generator. Diesel is N150 per litre. It does not make sense to continue to spend that when I was not using it for commercial purposes. Now that I have an inverter, there are so many advantages. I agree that it is expensive, but it is worth every kobo,’’ he says.
Country of lingering darkness
For many Nigerians like George and Eze, nightfall is not radically different from what the South African poet, Oswald Mtshali, painted in his classic poem, Nightfall in Soweto. For decades, the ‘Giant of Africa’ has struggled with underperforming power institutions and facilities, only recently managing to boast 3,674 megawatts. In spite of the privatisation efforts of the President Goodluck Jonathan administration, however, a fresh wave of darkness looms over the country.
Last week, the Minister of Power, Prof. Chinedu Nebo, announced a 1,000 megawatts drop in power generation. According to him, the imminent closure of Utorogu and Ugheli East gas plants would translate to a drop in gas supply to a couple of power generation stations.
“This will no doubt have an impact on the output of the power stations fed by these gas plants, which include Egbin and Omotosho. The plants, to be shut for short periods of times, on different dates, will inevitably result in temporary loss of generated power,’’ had said.
Before the recent development in the power sector, however, many Nigerians have devised means of beating the plague. Individuals and business establishments have turned to alternative power sources. According to experts, the current power generation output in the country is grossly inadequate to put manufacturing, the real sector of the economy, on the right footing. At 79 per cent, an opinion poll on the website of the association rates electricity as the ‘biggest impediment’ faced by manufacturers in Nigeria. Capital follows at a distant five per cent, patronage at four per cent and raw materials at one.
A thriving business opportunity
But with the deficit in power generation has arisen business opportunities, a thriving sub-sector of alternative power source. While Nigeria has relied solely on hydro, gas and thermal power sources for ages, more citizens are exploiting the lacuna, setting up outfits and partnerships to supply renewable and non-renewable alternative power sources for others who can afford them.
Long before inverters and solar panels established a strong presence in Nigeria, generators were the face of alternative power source. Generators oiled the economy of establishments and small businesses such as factories, hospitals, and those of hairdressers, welders, battery chargers, and others. Last year, the Director-General, Centre for Management Development, Dr. Kabir Usman, disclosed that 60 million Nigerians spent N1.6trillion purchasing generator annually. Aside from the big names that dominated the market, the subsector opened employment opportunities for men and women who made good profits selling and servicing generators in both rural and urban centres.
For the generator market, however, a chink in the armour exists. Compared to deaths from generator fumes, noise pollution, diesel and maintenance costs appear to be the lesser evil. Many Nigerians who relied on generators to power their homes and businesses have died of carbon monoxide, a toxic emission from generator fumes. With these drawbacks, the Nigerian market has gradually opened up to the gospel of renewable power source.
Speaking to stakeholders, our correspondent gathers that the zero startup capital has made renewable power source an attractive business for many Nigerians. The Technical Support Officer, Renewable Energy Solutions, Mr Demola Bandele, says he started out with little or no capital.
“I started with my salary. I was buying dead batteries at the time. Dead batteries can be recycled by manufacturers. So, what I used to do is to go around and ask people with dead batteries if they wanted to sell or dash me the batteries. Then I sold to the importers who also sent them abroad for recycling. But for anyone who does not want to go that route, it is possible to start with N500,000. There is no need to stock the products. Let the suppliers stock it. You just go about looking for prospects, you know the price you are getting the products from the suppliers and the price you are selling.’’
The Managing Director, Dalex Nigeria Enterprises, Mr. Deji Ajayi, corroborates this opinion. According to him, one may not need anything to start off.
He says, “What you need is just enough money to buy a phone and print invoices and receipts. Maybe you need some money to move around and meet people and canvass for sales. You can get the products on credits from the suppliers and pay back once the client makes payment.’’
For Ajayi, it all started as a passion. Ajayi says he in fell in love with alternative power sources as a boy watching Indian movies. In one of his beloved scenes, an intruder creeps up to a house enveloped in darkness.
“But as soon as he crossed a line, some bright light automatically came up as a result of an in-built sensor. He got caught. When I was also young, robbers visited a house near where I lived. The only reason they were successful was because the house was in the dark. Ever since then, I have always been interested in renewable energy solutions,’’ he recalls.
Ajayi opines that power inverters and solar panels have advantages over generators.
“The deliverables you get cannot be overemphasised. It is clean, noiseless, odourless and child-friendly. Generators, on the other hand, are noisy, not environment-friendly and requires maintenance.’’
But there are major shortcomings also. Prices of renewable energy solutions are hefty and may be out of reach for many Nigerians.
Ajayi agrees, saying, “The initial cost outlay is huge. The cost of watts to naira is also a disadvantage.’’
The Managing Director, Collins Energy Nigeria Limited, Collins Olorondu, also sees it in that light. But for him, inverters, solar panels and other types of renewable energy solutions are worth the cost.
“The initial outlay, the initial investment to get a solar panel installed in a house might be a major investment for an average Nigerian household. But remember, we are doing a comparative analysis here. If a family has the financial ability to buy a 5000watts generator, and if they are going to use the generator every day, my question is: ‘How much do they spend on fuel in order to generate that 5000watts of electricity?
“No matter the amount of initial investment that you do with solar installation on a residence, in the long run it is worth it, especially with regards to the warranty. When you install each solar panel, you have a life cycle of 20 to 25 years that you don’t pay any more for fuel,’’ he insists.
‘Inverters are affordable’
Bandele actually believes that inverters are affordable to an average Nigerian family. He reasons that a Nigerian who can afford to fuel a small tiger generator for two months can conveniently purchase a moderate-priced inverter.
“It is affordable, no doubt. If you own a small Tiger generator with a tank of five litres that can last you for six hours, you can fuel it at N500 a day for two months. Then you can afford an 800watts inverter and a 100amps batteries that can last for three hours after a power outage. This can only give you the basics such as light, fans and a television. When it comes to heavy-duty equipment like a washing machine, water pumping machine and fridge, you have to compliment it with a 27KV generator,’’ he says.
However, Bandele, who also developed an enduring love for renewable energy solutions as a young boy, admits that some inverters with longer capacity can be costly for an average family.
“Inverter solutions are a big investment at the initial state. Usually, many people find it difficult to buy the idea but at the end of the day, they get to enjoy it. Inverters are noiseless and do not produce fume,’’ he adds.
He also explains that more Nigerians are disillusioned with the fuel price hike and are pitching tents with renewable power sources.
“It is easier to convince people now than in 2007 when I started. It is a lucrative business. For now, diesel price is increasing and it is hard to buy fuel at N97. Many people buy it at N105 or more. If you have a block of six flats, usually, the landlord insists everyone should put their generators downstairs and not on the balcony. Someone living at the top flats would find it difficult to come downstairs every night to put off the generator. So, more people are embracing renewable energy options,’’ he says.
Counterfeits inverters, counterfeit batteries
It is, however, not yet eureka for this budding sub-sector. Our correspondent discovered that an influx of fake products from India and China poses challenges of patronage, trust and profit loss for clients and suppliers. Only five years into his romance with renewable energy solutions, George has been a victim of fake batteries.
“It was an unfortunate incident. I once got fake batteries that never lasted. I felt bad because these were the expensive type. I spend up to a million naira each time I change my batteries. And even if you complain, they will ultimately tell you to remember that they are not the manufacturers,’’ he laments.
That costly fate has not befallen Eze yet. But for him and many other Nigerians, there is no protection whatsoever. Yet, suppliers are often the worst hit as they lament that the fake products drastically cut their profit margin. Ajayi says he has had to replace batteries worth N1m for clients in the last four months.
“We have been victims of inferior batteries many times. For me as a supplier and installer, I want to be sure that if I give a one year warranty to clients, they should not have cause to complain. But I have had to replace batteries worth one million naira in only four months. The quality of the batteries from China is often inferior to those from Europe and America. But the products from Europe and America are more expensive, anyway. I don’t have the financial muscle to import directly. I rely on other guys who have the money. A number of times, they defraud us,’’ he adds.
Bandele also believes that European and American products are more reliable than products from India and China. His words, “The support from government is not there. You are on your own if you buy substandard products from China and India. But if it is a product from Europe and America, once your voltage gets to a particular threshold, it is going to shut itself down. That is not so for Indian products. What we have tried to do is to talk to them. Let the Indians bring their engineers into Nigeria. But they are not taking heed.’’
An industry waiting for regulators
In spite of the employment generation prospects that renewable energy provides, our correspondent noted that the various business units have no formal representation liaising with any government agency.
The boom in the renewable energy solutions notwithstanding, Bandele and Ajayi are aware that the dance may soon end. Last year, President Jonathan boasted to a group of journalists that they would not have the need of their generators by June. Though that declaration has yet to happen, recent events in the power sector suggest consistent steps to a power outage-free Nigeria. Stakeholders believe that the unbundling of the defunct National Electric Power Authority is the first step of the journey.
Ajayi has thought of the odds. But he is confident to survive that phase when it eventually comes. “We are not competing with the PHCN or the companies it has transited to. Rather, we compliment the efforts of the government in ensuring stable power supply. When the situation improves, however, I already have an idea of what I would metamorphose into. That is why it is important that we keep clients happy because they will still be there for us when we eventually metamorphose into other areas,’’ he says.
Bandele, on the other hand, believes that the business cannot go into extinction. “I cannot tell you that a stable power supply will not affect us. It will. But there is now way we are going to be entirely out of business. Some businesses will still need our services. There are certain equipment that do not take kindly to fluctuations. It damages the equipment and costs more to replace. Such companies and factories would still need renewable energy solutions,’’ he explains.
Speaking with our correspondent, the Senior Special Assistant, Access-to-Power/Renewable Energy, Dr. Albert Okorogu, admits that the activities of importers and suppliers of renewable energy products have not been on the radar of the Federal Government.
He says, “Yes, we really have not policed these products in the past. Some of these solar lights are dead as soon as they are deployed. They are substandard. We are trying to stop them from turning Nigeria into a junk yard.
“We are in the process of setting up the National Agency for Science and Engineering Infrastructure, an outfit of the Federal Ministry of Science and Technology. But it is still at the planning stage. We may decide to set up an independent outfit. We must verify all these products. That is the standard in developed countries.”