The disparity between a fast-growing economy and a failing grid has resulted in the Nigerian populace resorting to self-generation via fossil-fuel generators. Unfortunately, aside from the health risk associated with the use of fossil-fuel generators, operations and maintenance account for about 25% of SME expenses in Nigeria.
This interview was originally published in African Power & Energy Elites 2021.
Nigeria has the largest economy in sub-Saharan Africa but suffers from significant energy poverty. Currently, the country’s total installed grid capacity is estimated at 13GW, equivalent to 65W per head for its teeming 200 million population. South Africa is the second-largest economy in sub-Saharan Africa, and its installed grid capacity is equivalent to 755W per head.
Of the installed 13GW in Nigeria, a mere 3.9GW are operational due to poor maintenance of power plants, frequent vandalism of distribution/ transmission lines, and insufficient gas production (85% of installed capacity is fuelled by gas). The current transmission capacity in Nigeria (5.3MW) is higher than the operational generation capacity (3.9MW). However, the transmission capacity is constrained by frequent system breakdown and limited operational capacity.
Rensource Energy seeks to bridge the energy gap faced by Nigerian MSMEs by deploying solar-hybrid captive power solutions. To date, the company has powered c.10,000 MSMEs across 8 economic clusters (markets) across Nigeria using solar off-grid solutions. The largest cluster they serve is in Sabon Gabi market in Kano, where over 6,000 MSMEs rely on these services. These markets are completely off the grid or ‘under grid’, and the merchants consider the provision of diesel-based generation as the most effective source of reliable power for their shops, resulting in significant noise and air pollution, and depletion of the ozone layer from the release of poisonous carbon monoxide. Other hazards from the existing solution are the frequent fire incidents from the use of these generators which often destroy millions of naira worth of goods.