Nigeria: Replacing diesel generators with locally-made solar power equipment

Ogechukwu Uchechukwu, co-founder of Greenage Technologies

Nigerians are familiar with getting their electricity from off-grid sources. With the country’s national power grid generating just a fraction of the population’s energy needs, it is estimated that around 60 million individual Nigerians, and over 85% of the country’s businesses, own personal power generating units. The vast majority of these are fossil fuel powered generators.

Part of the reason why generators, particularly diesel, have remained so pervasive is the high up-front cost, and complexity, of the alternatives. Renewable energy sources such as solar require a range of different components – including batteries, inverters, and charge controllers – to store the energy, convert it to a useful state, and to regulate the flow of electricity. These components need to be imported from abroad and repair work often requires specialist skills, which can be costly and hard to find.

Ogechukwu Uchechukwu, co-founder of Greenage Technologies, is on a mission to make it easier and cheaper for Nigerians to buy solar home systems – by manufacturing them in Nigeria.

From bedroom to factory

Like many other Nigerians, the Greenage team found electricity to be a major issue whilst studying at the University of Nigeria, Nsukka, in Enugu State.

“We were managing a serviced apartment rental business with a few other students whilst studying at the University of Nsukka,” he says. “But of course, reliability of electricity was a major problem. We looked into buying solar but it was very expensive … many people simply cannot afford to pay for it.”

So Uchechukwu – along with co-founders Aaron Esumeh, Kingsley Okereke, Nnaemeka Udehand and Godwin Nwangele – decided to try to address the issue by manufacturing inverters and other equipment themselves, sourcing individual components wherever they could, and assembling them on circuit boards in their rooms.

They presented an MVP (minimum viable product) at the university’s trade fair in 2016. The event was attended by the state governor and this, along with other public appearances, helped the new business to attract publicity and funding. By January 2019, Greenage Technologies had secured over $157,000 in seed funding over two separate tranches.

“When we started, we were doing more advocacy work,” Uchechukwu explains. “We were going around talking to people, educating them about things such as the capabilities of solar, as well as the potential fuel savings.”

“There is a kind of stigma around solar power in Nigeria. Lots of people had faith in solar when it first came on the scene, but then lost faith because it did not work for them. We spoke to people to understand why this was – often there was a lack of trust. Equipment would get damaged or stop working, and no one would be able to fix it. Then it ends up getting abandoned.”

A market beyond Lagos

In January 2018, Greenage relocated to the state capital of Enugu, to set up a modest factory. The team believes that smaller, regional cities like Enugu present huge opportunities and are often overlooked when compared to more popular and famous hubs such as Lagos.

“Lagos and Abuja are the hotspots for most solar retailers. By working with a network of distributors and technicians, our products and services are currently available in 21 of Nigeria’s 36 states – this is a huge market of tens of millions of people who need access to reliable electricity.”

“Most of the people in the solar trade in Nigeria are traders – importing equipment and selling it to consumers. We don’t see ourselves as simply traders or salespeople. We see an opportunity to capture a lot more of the value chain here in Nigeria.”

A Greenage employee installs a solar energy solution for a client in Nigeria.

Manufacturing process

Greenage’s factory in Enugu is filled with countless boxes of different components, ready to be attached to boards and housed inside casings by the assembly team. Uchechukwu explains that 70% of the parts are sourced locally, with some specialist components, such as diodes, being imported. Sourcing the raw materials locally, Uchechukwu and his co-founders agree, is the biggest challenge in this business.

Greenage sells a full range of products, including the charge controllers and inverters assembled in Enugu. A small inverter retails for 160,000 naira (around $260), whilst the largest retail for 3,000,000 naira ($4,920). These units can reach up to 30 KvA, which can handle enough power to light a large family home, with a number of heavy appliances.

Uchechukwu, whose aim is to replace imported components with locally made equivalents, believes that Greenage’s products can be up to 30% cheaper than the imported versions. Its inverters and charge controllers are interchangeable with other brands of panels and batteries, and can therefore be slotted into new or existing setups.

Additional components such as solar panels and batteries are also sold, although they are not yet manufactured locally.

Making installation easy

As well as price, complexity of setup is another major barrier for many consumers that might otherwise consider solar power. Unlike diesel generators, there are many different components to factor in, and many technical terms that people are unfamiliar with.

So as well as producing components, Greenage Technologies also has a business unit that specialises in installing solar micro-grids and home systems. The team will inspect the house or business, and provide a recommendation for exactly which system is needed.

“We have installed more than 700kW of solar power across the country – that’s more than 200 homes across the country, and more than 50 businesses, including hospitals and laboratories.”

Whilst most of this business has come from word-of-mouth, the company also uses a mix of traditional and digital marketing channels, including billboards, radio, Facebook and LinkedIn adverts, to reach new customers.

Future plans

Greenage recently raised $500,000 in funding from impact investor All On Nigeria. It plans to use these funds to expand the factory and distribution network, so that the business can produce and sell more units.

By the end of 2023, the company is aiming for a monthly product volume of 200 units, and 500 by the end of 2025. Beyond that, it is looking at exporting beyond Nigeria and replicating its factories in other countries.