Across Africa, the investments into industries have increased over the years, as with the demand for goods and services to match the expanding population. These industries include manufacturing, pharmaceutical, technology, banking institutions, and residential and commercial buildings. For each of these industries where commerce and trade are active, there is a need for electrification.
The renewable energy dialogue hosted by The Electricity Hub sought to analyse the connectivity between the Commercial and Industrial sectors (C&I) and electricity. In addition, how reliable and accessible off-grid solutions can improve the C&I sectors in Niger Delta.
Present at the dialogue was MK Balaji, Off-Grid Team Lead, Nigeria Power sector Program. He explained the various approaches in which off-grid players can offer energy services to C&I customers. They include;
- The C&I customer solely purchasing all available power solutions typically referred to as the Capex model.
- A credit-worthy customer can access loans from banks to fund energy projects. This approach offers the customer the opportunity to leverage their equity.
- Energy-as-a-service model: Here, customers pay for a service without making any initial upfront capital investment.
Equally present at the dialogue was James Shoetan, Head of Business Development, Cross-boundary Energy. He elucidated on the nature of C&I customers that energy providers can operate with. They include customers who consume a high amount of energy, duration of operation (day/ night time), and longevity of the business.
The challenges encountered by energy providers to deliver successful operations to C&I customers were also highlighted, such as the mode of transaction. For example, off-grid energy equipment is sourced and paid for in foreign currency. However, due to the huge difference in exchange rates, C&I customers find it difficult to pay for the service. To mitigate this, service providers have to give customers some percentage discount to assist them with payments.
In conclusion, there is a huge need for energy for commercial and industrial operators to function optimally. As discussed in the dialogue, there is an open market for both players to operate.