Start with the sun

The future of business in Africa belongs to companies who not only seek out new opportunities, but can also adapt to the shifting economic landscape of the continent: and nowhere is this more critical than in energy cost management. Alternative Energy provides a watershed that a growing number of companies are keying into. Derek Nwafor, CEO of Solidlight Limited, expands on the subject.

“The import tariff for alternative energy generation systems should be suspended for at least 20 years”
-Derek Nwafor

What are the challenges involved in providing alternative energy solutions to large scale and retail clients?
Derek Nwafor. The greatest challenge to us on this campaign is a lack of awareness of these systems and the quality assurance that comes with them. In our interactions with the public, we find that once this is overcome, other issues are easily addressed. As in other countries, building architecture and even ergonomics hardly take into consideration the possibility of clean energy systems, the failure of conventional systems or the rise in the cost of energy being experienced around the world today.

Consequently clients have to optimize all electrical devices and fittings to derive value from alternative energy systems. Un-informed financial institutions also pose a challenge, as lenders in Africa are seemingly unaware of the viability of alternative energy as an investment and as such are unwilling to support such ventures. The recently revamped Nigerian pension system currently holds funds in excess of US$3 billion which can be invested in alternative energy projects across the country.

What is the government's role in enhancing the proliferation of alternative energy systems in Nigeria?
DN. The Nigerian government needs to provide more support for clean energy technology in the country. On the legal front, the laws guiding the generation of power by private entities needs to be amended to allow market forces to determine pricing and allow power stations choose their clients. Current legislation states that a portion of each station's output must be channelled directly into the national grid; this is paid for by the government at a rate fixed by themselves.

The import tariff for alternative energy generation systems should be suspended for at least 20 years. Subsidies and grants should be provided for various institutions (for example in health, agriculture, science and technology development and education) to support a transition to solar or wind energy. The government itself should broaden its deployment of sustainable systems beyond solar street-lights to creating sub-stations for localities. Also tax breaks can be given to companies that are engaged in generating alternative energy.

How can alternative energy help to jumpstart small and medium-sized enterprises in Nigeria?
DN. Coming from successfully deploying Grid-tied inverters with capacity totalling over 100kvA, we propose the development of mini and medium scale industrial parks for businesses preferably in light manufacturing, food processing and some service providers. These parks will be powered with solar energy, providing clients electricity for 16 out of every 24hours. We believe that with consistent, predictable and well-priced power, most start-up businesses in Nigeria can survive the crucial first five years of business.

What methods can be used to wean big business from the use of fossil fuels?
DN. This can be achieved by the sensitisation of senior management, shareholders and business owners through such forums as their Annual General Meetings. The long-term value to be derived by deploying alternative energy systems outweighs the comforts of retaining antiquated practices, which cost several times more than sustainable energy systems over time.

Change in this vital area of any business has to be understood and driven from the top, and as mentioned earlier, shareholders are the preferred audience as they stand to benefit from increased growth of their investments.

Derek Nwafor is CEO for Solidlight Limited, a leading alternative energy company in Lagos, Nigeria. A former Banker and Business Development Executive, Nwafor's career has spanned the financial services, logistics and corporate surrport services sector. An alumnus of the prestigious University of Ibadan, he has also taken management courses at the Lagos business school.

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