Partner Showcase – Titanium Partner | Conlog
In West Africa, Nigeria dominates the continent as the most populous country and largest economy with nearly 200 million citizens. However, Nigerians only consume 144 kWh per capita annually, due to constraints and limitations in the power sector.
Despite the region having an abundance of resources including oil, gas, hydro and solar, they remain largely untapped. In a position to produce 12,522 MW of power, the country is only generating up to 4,000 MW on most days due to various contributing factors that hamper the existing power system. Nigeria, therefore, remains one of the most underpowered countries in the world, with actual consumption 80% below expectations based on current population and income levels.
According to the national energy regulator, the Nigerian Electricity Regulatory Commission (NERC), about 4.7 million (approximately 57%) of registered electricity customers have not been metered. This has led to a staggering estimated $29.3 billion in annual losses due to the low supply of electricity resulting from non-scheduled load-shedding or, in most cases, dilapidated infrastructure.
The current access rate is estimated at 45%, with a split of 36% in rural areas and 55% in urban areas. The number of households without access to power is estimated to be in the region of 20 million. Furthermore, Nigeria has privatised its distribution companies, resulting in a wide range of tariffs.
INTRODUCING NEW REGULATION
On April 3, 2018, NERC introduced the MAP (Meter Asset Provider) regulation to draw new investors to its power sector to stimulate the rollout of meters through the engagement of third-party investors. This new regulation aims to attract
private investments, which will inevitably create a new metering industry and reduce commercial losses, a significant game changer. The MAP regulation re-allocates the responsibility for providing metering services, thereby creating a new class of market participants.
Regarding this, NERC states: “MAPs shall charge a maximum of N36,991.50 for single phase meters and N67,055.85 for three phase meters. These costs are inclusive of supply, installation, maintenance and replacement of meters over its technical life of 10 years.
“The Commission shall closely monitor the rollout plan of distribution licensees and overall compliance with the regulation and various service agreements by the MAP and electricity distribution licensees.”
Customers have also recognised the need for sustainable access to energy and have welcomed the MAP regulation, which has created an expectation that access is imminent. According to the regulation, customers may now directly approach customers may now directly approach the DISCOS and designated MAP or bank for purchase of single and three phase meters, for the purchase of single and three phase meters, and once payment is made, the MAP must have the meters installed within a maximum period of ten days. Payment for the meters could either be upfront or through a credit financing arrangement with individual MAPS and Banks. In other words, a customer may simply apply to a MAP, pay the total cost of the meter and have the same delivered and installed in the premises within a period of ten working days.
“NERC has mandated all Discos to meter all unmetered customers by the end of 2021”.
YOUR TRUSTED PARTNER
Confirming their commitment in the region, in 2019 Conlog registered a local entity – Conlog Meter Solutions Nigeria Limited (CMSN) – opening its first offices in Ikeja, Lagos Nigeria. As part of the MAP programme, the firm has been supporting the local Meter Asset Providers (MAPs) and parent company Consolidated Infrastructure Group (CIG) as a Meter Service Provider (MSP), connecting Nigerian consumers with electricity resources. Nigerian utilities and their suppliers have been working with Conlog for more than ten years, resulting in more than 750,000 Conlog meters being installed in various locations across the country.
“Conlog has been assigned the responsibility of metering homes in Akowonjo and Abule Egba districts over the next three years”.
As a MSP, Conlog Meter Solutions Nigeria currently employs over 20 people (permanent and contractual) and continues to see this number grow as the demand increases. Conlog has been assigned the responsibility of metering homes in Akowonjo and Abule Egba districts over the next three years. This is testament to the company’s purpose statement, which is ‘Enriching Lives by Connecting People and Resources’.
One of the main objectives for entering the Nigeria market is to assist in the MAP programme by increasing the manufacturing capability in Nigeria. Thus, Conlog plans to produce at least 30% of their meters locally while employing local operators. As part of demonstrating their commitment to Nigeria, the company has commenced with the project of establishing its last mile assembly plant in Ikeja. This plant is intended to expand and contribute to the growth of the supply chain sector for the benefit of the industry.
Conlog aims to contribute to Nigeria’s vibrant and aggressively growing economy by working together with MAP companies in ensuring the stability and prosperity of the Nigerian electricity sector. The ultimate aim of the company is to create access to energy for consumers in Africa in its most basic form through the use of technology and other market tools. Conlog has a footprint in Africa spanning more than 25 countries.
Further to Conlog’s commitment to geo-expansion and deepening its market presence in Nigeria, plans are afoot to establish a local manufacturing facility in Nigeria to facilitate the transfer of skills and technology in the metering space across the continent.
“We are enthusiastic about the opportunity to work with the Distribution Companies and Meter Asset Providers across Nigeria to achieve the objectives of the MAP regulations recently passed by the regulator,” states Conlog. The main objective of these regulations is to achieve the following:
• Encourage the development of independent and competitive meter services in the Nigerian Electricity Supply Industry (NESI).
• Eliminate estimated billing practices in NESI.
• Attract private investment to the provision of metering services in NESI.
• Close the metering gap through accelerated meter rollout in NESI.
• Enhance revenue assurance in NESI.
The firm’s partner company, CIG Metering Assets Nigeria Limited, has been selected by two of Nigeria’s leading distribution companies – Ikeja Disco, and Eko Disco – and allocated $60 million worth of meters in the first wave of tenders with Conlog providing the full suite of solutions to support the delivery on both projects. Additional procurement waves are anticipated going forward to fill the metering gap.
“We have estimated that the opportunity for meter rollout in Nigeria is approximately 39 million meters over the next 10-15 years,” Conlog estimates. Estimates are that only 43% of 8.3 million registered customers are metered (3.6 million) and 50% of those meters are obsolete (1.8 million in working order), resulting in 6.5 million meters needing installation.
NERC has mandated all Discos to meter all unmetered customers by the end of 2021. Out of 41 million Nigerian households, 33 million are not registered (likely need to be metered). There is an untapped market of 33 million households.
With Conlog’s experience of operating in Nigeria for 12 years coupled with the recent licence by NERC to operate in Nigeria as a Meter Service Provider (MSP), the opportunities in Nigeria are endless.
“Conlog Meter Solutions Nigeria currently employs over 20 people (permanent and contractual) and continues to see this number grow as the demand increases”.
About the company
Conlog (Pty) Ltd is a global organisation with over 50 years of electronics and prepaid electricity metering solutions. We pride ourselves on the quality of our products, particularly the durability and reliability of our meters in the harshest of climates. With a worldwide installation base of over 12 million meters, and a less than 1% return rate, our product quality performance is second to none. Over the years, 70% of our business has been in the Sub-Sahara Africa regions; with 20% in South Africa, and 10% in the rest of the world. We pride ourselves on being an African technology innovation company actively contributing to African infrastructure developments.