How two former bankers set up renewable energy firm to power businesses
Nigeria is the most populous country in Africa with an estimated 186 million people. These people need power in their homes, offices and businesses. With power generation capacity in the country hovering between 4,000 megawatts (MW) and 7,000 MW, and distribution still below 5,000MW, nobody needs a prophet to learn that the country is highly underpowered.
Nigeria’s low hanging fruit, however, is renewable energy, which is proving to be affordable and reliable. Ovoke Ekrebe and Peter Ejimudo have tapped into this sector, powering more than 1,500 homes and 45 businesses through solar energy.
In 2011, the two former bankers set up Vanpeux Global Synergy at Kalejaiye Street, Shomolu, in Lagos, as a general technology outfit.
One and a half later, these entrepreneurs lost every penny they invested in the business. But this was part of the learning curve.
“We were like living beings that died and resurrected. We lost all we had and started afresh,” Ovoke Ekrebe, co-founder of Vanpeux, tells Start-Up Digest.
“It is true when they say that small businesses fail in the first one or two years. We have done our failing and have resurrected, never to fail again,” Ovoke says confidently.
Four to five years later, this firm has risen to become one of the most sought-after in Nigeria. Apart from serving numerous customers, Vanpeux has become one of the 45 renewable energy firms certified to do solar business in Nigeria by the United States Agency for International Development (USAID) and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), American and German development agencies respectively. This is a lesson for the upcoming entrepreneurs or those going through trying times that tough times do not last but tough people do. One of the factors that helped the business was its proactive, rather than reactive, response to challenges.
“It is a fantastic seal of performance. There are so many businesses in Lagos. There are over 1,500 renewable energy firms in Lagos alone that claim to proffer renewable energy solutions. There was a project that USAID ran, which was a renewable energy efficiency programme that supported private companies. At the end of their programme, they did some form of audit in Nigeria and found 45 worthy.
“Twenty-five or 30 are located in Nigeria. We are among the 45 recommended to undertake renewable energy all over the world. That means we have passed capacity tests and have the ability to take up renewable energy projects from start to finish. Our customers should be very proud to know that reputable international organisations have recognised our work. They can have confidence that we are providing reliable renewable energy solutions,” Ovoke says.
The firm provides solar-to-water generation solutions. This means that a farmer does not need to wait till the next rainy reason to plant, which is one practice threatening Nigeria’s food security.
The company provides solar water heaters, which can be used at homes, hospitals and factories. It also provides solar PVs for electricity generation. Start-Up Digest understands that the firm has solarity power box of 1.0 to 3.0, and solar panels between 100 watts to 300 watts, among others.
One of the major complaints against renewable energy is its cost. Many farmers, small and medium businesses and households say it is highly priced. But Ovoke disagrees.
According to him, renewable energy can only be seen as expensive when compared with immediate needs.
“Sometimes, people compare the price of diesel or fuel with the total cost of renewable energy. If you compare renewable energy that can last up to 15 to 20 years with buying a diesel, it is a mismatch. It is like comparing the cost of building a house with the cost of paying rent. Won’t you rather build a house, even if it means borrowing some money and pay over time?” he asks.
He points out with N500, 000, a farmer can set up an irrigation solution, explaining that renewable energy is replenish-able by nature and does not get exhausted.
He cautions that some solar water systems can go as high as N2.5 million, but adds that solar water heaters with a capacity to produce 50 to 300 litres per day go as low as N150,000 to N350,000.
“For solar for power generation, there is a wide range, from as low as 500 watts to as high as 100 kilowatts or more.
“For five kilowatts to 500 kilowatts, it is between N250, 000 to N5 million, depending on some issues. Some systems can have more batteries or solar panels, so the actual quotation will depend on some things. But it ranges from N300, 000 to as high as N5 million or even higher,” the entrepreneur explains.
He says that Vanpeux’s services are affordable and competitive as it allows customers to do spread payment.
But what motivated the two former bankers to establish this firm?
“We saw in advance that power was an issue. It was clear that power was an issue and the easiest way of getting power to the underserved was through renewable energy,” Ovoke says.
“There is a huge need for power. So many places are off the grid, on the grid but under-electrified (they have high tension wires and low voltage wires but are not powered) and off the grid,” he explains, urging communities to embrace this technology.
He says that Nigeria has an advantage of exploiting opportunities in renewable energy being in the Equator.
He notes that renewable energy power storage does not get exhausted during rainy season as many people think.
“During rainy season, what we have is reduction in power generation, but this does not mean absence of power. Even in rainy days, what we have is less power generation, which is always a few days.
“It is not a challenge. If Germany that has winter and other parts of the world with terrible conditions use renewable energy; if Islands
of the Pacific can set up solar farms, why not Nigeria which is in the Equator?” he asks.
However, one big challenge facing this firm is funding. The firm plans to power hundreds of thousands of homes, offices, factories and hospitals, but it is hampered by funding.
The firm needs over N150 million or much more to fund several projects on the pipeline. It is also interested in investors who are willing to pump in money for expansion.
ODINAKA ANUDU