“At EAPIC I look forward to sharing the SAP view of how new technologies will shape the future of utilities and enable them to remain relevant and thrive in the digital future”
1) Let’s start with some background on SAP and projects that you are involved in in East Africa, particularly in the energy and infrastructure sectors?
SAP (Systems, Applications and Products) established itself on the African Continent in 1982, initially only operating in South Africa. After securing its first African customer outside of South Africa in 1996, SAP continued to grow and expand in the rest of Africa. In a two-pronged approach to take advantage of the imminent increase in bandwidth capacity and reach more small and medium enterprises in East Africa, SAP Africa established a hub in Nairobi, Kenya, in 2009 from which it still supports the entire East Africa region. SAP has over the years invested heavily in the Energy, Utilities & Infrastructure space as we see this as a cornerstone of Africa’s development and continued economic growth. Some of the largest Utilities in East Africa are SAP customers and use SAP solutions to manage their internal operations and asset maintenance. The ENR (Energy and Natural Resources) Industry forms an integral part of the SAP Africa growth strategy and we continue to build a solid partner ecosystem that can support us in deploying SAP at various East African Utilities.
2) Any specific projects in the region that you are particularly excited about at the moment?
SAP Africa is passionate about multiple projects in East Africa at present! In some instances what excite us is the impact and efficiency these customers will gain in operations and their supply chain, thereby ensuring that savings from newly gained efficiencies can be ploughed back into growth. It is also exciting to see our customers’ new-found focus on the “Utility of the Future” including innovations around billing, customer experience, and the use of the Internet of Things (largely SCADA & related data) to drastically improve real-time insights into their business performance.
One example of this is that most East African Utilities are still facing major breakdowns as a result of old infrastructure which effects energy security. New technology now makes it possible to move from the traditional planned maintenance to predictive maintenance, where information gathered from sensors is used to determine the health of assets and the need for maintenance. Many have only embarked on the journey but have shown foresight in where they want to be. Unfortunately we are under NDA and do not have authorisation to mention names for many of our customers in Africa at the moment. Inspirational customer success stories are however frequently shared with the media in East Africa.
3) What are the challenges to getting power projects off the ground in the region?
The challenges often faced are largely finding the funding or finding funding under the right conditions. Because of regulatory requirements and in an effort to ensure that electricity prices stay affordable, it is very difficult to attract private investors. The second challenge often faced is political influence given the importance of power both to economic growth and private individuals. This, however, is not necessarily always a negative influence. In Kenya, for example, President Uhuru Kenyatta has set highly ambitious targets and is making huge inroads into expanding both the generation capacity as well as the rural expansion.
What is interesting is that, when power projects commence, huge focus tend to be around design planning etc, with less emphasis placed on the customer-facing front-end. What I mean by this is that projects don’t necessarily initially focus on how to ensure accurate billing and that all requirements (pre & post-paid, commercial vs Private, price-setting/flexibility depending conditions such as off-peak hours, excess capacity, cross border transactions…) are met. Ensuring proper focus and planning around end-customer requirements remains key and is imperative to ensure quick collection to settle the costs of projects and enable re-investment. From a global project perspective, there are very often ways in which SAP can ensure improved efficiency through holistic value-chain review and the implementation of SAP solutions to provide full transparency and support various other processes and procedures including fraud management (technical & non-technical loss monitoring and prevention), analytic visibility to optimise power generation and limit excess, improve supply chain efficiencies, significantly simplify and reduce maintenance costs and improve customer satisfaction.
4) How investor friendly is the region?
My answer would be partially investor friendly. Most East African companies are already working with or considering working with IPP (Independent Power Producers), so mainly in the generation area. Another area where we see lots of investment happening is in the smart meter and pre-paid meter areas. The willingness to adopt technology is noticeable as is the vision around improving the lives of citizens and ensuring continued growth. However, in my personal view there are two key factors that impede it:
1.) Corruption: this remains an issue across the continent and large & complex projects provide mechanisms that make it relatively easy to funnel smaller amounts around without notice
2.) Maturity & longer-term insight: The decisions through the public sector at times can be more short-term focused in terms of ensuring immediate visibility or short term cost-saving/advantage rather than the longer term holistic approach. This often depends on the level of independence of a utility and effective political influence.
5) Which countries are doing well in attracting the right projects?
In our experience most of the East African countries are already working with Independent Power Producers. Projects include wind farms, solar plants, geothermal plants (which seems to attract especially European investment) or the building of dams (via mostly Chinese investment).
6) You have several speakers on the EAPIC conference programme. What will SAP’s message be at the event?
The SAP Africa message is that organisations need to focus on becoming a relevant digital utility of the future. SAP will focus on how new technology and big data can be used to significantly improve efficiencies and how the performance of utilities infrastructure can be optimised to prolong the asset life span, maximising energy production, minimising downtime and reducing maintenance cost.
7) What are you most looking forward to at EAPIC?
I look forward to sharing the SAP view of how new technologies will shape the future of utilities and enable these organisations to remain relevant and thrive in the digital future. I also look forward to engage with key players in the utilities market, to collaboratively discuss how SAP Africa can support their vision and contribute to the East African market in a significant manner. SAP Africa is adamant on contributing to the regional economic growth of East Africa.
8) Anything you would like to add?
More than 4,200 utilities companies in 123 countries are innovating with SAP solutions. 45 of the 50 top utilities companies in the world run SAP solutions. We have the knowledge and expertise to support Utilities of all sizes in East Africa with the vision of reducing the complexities within their business and joining them on the journey to their digital future!