NIGERIA - Green Economy
Co-Founder & CEO, IHS Nigeria
Mohamad Darwish has over 15 years of experience working in the telecommunications sector. He is the co-founder of IHS Towers, has worked in various finance and technical functions, and served as the IHS Nigeria Business Development Director and Deputy CEO before becoming the interim CEO of IHS Nigeria. He oversees the development of the IHS Nigeria strategic plan, the roll out of new sales strategies, and manages various key relationships with clients, regulators, ministries, and NGOs. He has a master’s of engineering in applied operation research from Cornell University, an MBA from Rollins College, and a bachelor’s of electrical engineering from the American University of Beirut.
We started focusing on green energy a few years ago for two reasons. Firstly, it makes financial sense, and secondly it is environmentally friendly. Our business model is also inherently eco-conscious because instead of building two or three towers in the same area, we build one; therefore, less land is occupied and fewer power systems are deployed. To date, we have invested almost half a billion dollars in these initiatives. We have 15,000 tower sites in Nigeria, but since unfortunately every site has to have a power system attached to it, we are working to shift from the old conventional generator power systems to innovative green hybrid energy solutions that include solar panels. We also piloted a few wind turbines, but are focusing on solar technology for now.
In 2016, we commissioned a research report with The Economist Intelligence Unit (EIU) on green energy in Africa. The report concluded that governments need to promote green energy as the primary energy source in Africa and help subsidize the sector in order to reach these goals. We must also all work to protect consumers while simultaneously attracting investors by enforcing low tariffs. Governments throughout the continent need to work to improve regulation as well as the general ease of doing business. In terms of what the administration is already doing, the Nigerian government has clear plans for the energy sector, which was evidenced by the recent new ministry appointment. However, , the economy has gone in a different direction over the past few years due to a combination of factors, but we hope the recession will come to an end soon. One of the surprising findings of the EIU report was that South Africa was able to produce energy using green resources at a cheaper rate than with oil. Hence, eventually, green energy could become cheaper, though we must all work to invest in additional R&D to find the most efficient technological solution. Many multinational investors have shown a willingness to build solar farms in the country, but the two main challenges for prospective investors are currency fluctuations and the current state of the economy.
The potential for PPPs is there, and privatizing the power sector in Nigeria could be the first step. This would involve opening the door for international investors to come and invest here without too many restrictions. Where it becomes tricky is that high levels of investment will eventually force investors into liberalizing pricing; however, Nigeria must work to protect its consumers. This is where the government could come up with a subsidized system to help consumers without deterring investors. The Central Bank has started a few new initiatives to improve the investment climate, including the introduction of a window through which investors can bring in their funds and sell at any rate as long as they find a buyer within the country.
By making large investments in green energy, we opened the door for many companies to start thinking outside the box. The fact that we have invested almost half a billion dollars into new green energy power systems, and will continue to do so whilst looking for new solutions, should encourage others to take similar steps. We do not always have to wait for the government to intervene. Ideally, we would love continued government support, but until we get there we have to find solutions for the challenges associated with the services we provide.
NIGERIA - Energy & Mining
Group Managing Director, Eraskorp Nigeria Limited
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