How do you make your projects bankable?
RUMUNDAKA WONODI Capital is only interested in bankable projects. But we know that the big challenge within the energy space is the availability of bankable projects rather than a perceived lack of capital. This is why we at ZKJ primarily help projects achieve bankability by adopting a well-articulated advisory and engagement strategy focused on our deep understanding of the regulatory and commercial environments to meet the expectations and standards of lenders and equity investors. Beyond advisory, we also undertake and drive capital investment and project development. Aside from the private sector, we are working with government ministries, departments, and agencies and development agencies. At the moment, we are providing support to an NNPC-owned company that is developing over 4GW of gas-fired power plant portfolio in seven locations across Nigeria.
CHANTELLE ABDUL Mojec International/Mojec Meter Company is the largest meter manufacturer in West Africa. Primarily known on the continent as a market leader and innovator in metering with a state-of-the-art manufacturing facility in Lagos, Mojec has an installed annual production capacity of 2 million meters that produces a diverse range of products in its metering suites, including smart prepaid meters for residential and commercial clients, Prepaid Maximum Demand and grid meters for industrial clients, and the power genie platform remote monitoring system (AMI/AMR platform). Mojec remains at the forefront of innovation and metering technology and has a footprint of over 80% in the market with eight of 11 utilities as clients. Additionally, the firm provides metering solutions such as Mojec Power Genie platform, an energy management platform with a remote payment monitoring system and energy management platform, electricity vending, and billing capabilities. With a workforce of over 3,600 fulltime employees, an adhoc engineering team and nationwide installation team, and a track record of having injected over 1.2 million meters into the Nigerian market, Mojec has contributed significantly to bridging the metering gap in Nigeria.
What growth opportunities do you see?
RW We see growth opportunities in wholesale markets where we have built our competencies, specifically in generation and power trading. While renewables are increasingly becoming part of the supply mix, we remain bullish on gas-fired plants as baseload solutions for the country and subregion. So, back to your question, we see growth in generation and trading, and we know where the constraints are for now: transmission and distribution. What's more, many investors would likely be interested in contractor financing with a distribution company, but you have to work out a system for this. In a place like Nigeria, we have too many structural imbalances that we need to figure out before we can attract significant investor interest. However, Nigeria is too big to ignore. When you look at the supply gap compared to other economies you realize the huge potential. In Egypt, for example, there is 30,000MW on the grid to support 82 million people, while Nigeria has 180 million people but just about 5,000MW on the grid. There is so much that can be done locally, especially when you consider proven gas, hydro, and solar resources. Most investors are currently observing, aware of the sheer scale of the market, and how profitable it could be. Yet, they are also considering other markets while they wait for Nigeria to get its act together.
CA As a firm our expansion and growth have been primarily funded by our own private shareholder funds and from development finance institutions. Due to the nature of the industry we are in and the need for long-term financing, we have low interest rates. We have primarily focused on project finance funds from development institutions such as Bank of Industry (BOI) or special intervention funds from the CBN (Central Bank of Nigeria). Today, the metering gap in the country is slated at about 4.5 million meters by the electricity regulator. However, it is widely believed by industry stakeholders that this number would more than double or triple once full proper enumeration has been completed. At the height of privatization in 2013, the metering gap in the country was set at over 7.5 million meters with an estimated 80% of consumers unmetered. These numbers, if enumerated, would probably double or triple for Africa's largest nation and economy.