Local farmers and businesses in Nigeria can leverage the potential in renewable energy to remain efficient and profitable, writes Chineme Okafor writes.
A non-governmental organisation, Clean Technology Hub which focuses on renewable energy research and advocacy has discovered that business owners in Kaduna and Anambra States stood better chances at growing their operations and businesses with renewable energy solutions. This also suggests that it could be applicable in most parts of Nigeria.
These findings were the result of a project titled: 'Local Solutions Lab,' and funded by the Heinrich Boell Foundation that researched the challenges faced by micro, small and medium-scale enterprises (MSMEs) in the two states through workshops with the MSME operators, market associations and artisans' unions and co-created possible solutions to these challenges that incorporate the use of renewable energy.
The research was inspired by a report by Climate Transformation and Energy Remediation Society (CLIMATTERS) on off-grid power solutions for small businesses in Nigeria which highlighted the challenges of inadequate and unpredictable power supply and its costs to MSMEs, limiting their profitability.
For instance, the CLIMATTERS research showed that an average low-end barber shop in the country spends about N180, 000 annually on power supplied by electricity distribution companies (Discos) and for self-provision through fuel generators, while an upper-end barber shop spends N600, 000 for same per annum.
Similarly, cyber cafes from the research spend between N366, 000 and N858, 000 annually on same costs while shoemakers spend between N120, 000 and N274, 800 annually on cost for power supply, as well as N1, 764,000 is spent by cold rooms annually on power supply.
Even businesses as small as pepper grinders which are at the lower-end of the food-processing industry spend as much as N192, 000 annually on power supply using fossil-fuel generators.
These cost to power their operations constrain the businesses from increasing their profitability, and they could be reduced by using decentralised renewable energy (DRE) systems to run their operations instead.
Solutions for small farmers
At the workshops, Clean Technology Hub explained to the participants that there are efficient DRE solutions to address their business challenges and increase the profitability of their businesses.
For instance, farmers can leverage on crop irrigation system using Photovoltaic (PV) water pumping systems especially for off-grid farm settlements or locations to increase their food production.
According to Clean Technology Hub, these basic irrigation systems run pumps directly when the sun is shining and ensure they work hardest in the hot months when they are needed most.
"Solar irrigation systems have become very reliable and cost-effective. They equally require low maintenance costs farming communities can afford," said Ifeoma Malo, Chief Executive Officer (CEO) of Clean Technology Hub at the workshop in Kaduna which had 50 participants in attendance.
Besides the irrigation system, Malo noted that solar water heaters can also provide low to medium temperature hot water for pen cleaning, and that smallholding dairy farmers can as well use solar heated water to clean equipment, warm and stimulate cows' udders.
She also explained that DRE solutions could be used for crop and grain drying by farmers, adding that while they are efficient, they also could minimise post-harvest losses often posted by farmers in Kaduna and some other northern states in Nigeria.
"Solar drying equipment can dry crops faster and more evenly than leaving them in the field after harvest, with the added advantage of avoiding damage by birds, pests, and weather.
"A typical solar dryer consists of an enclosure or shed, screened drying trays or racks, and a solar collector, and can be done in a simple design," Malo, explained.
Providing an insight into how other small businesses could leverage DRE solutions in their operations, the Lead, Communications and Research at Clean Technology Hub, Mark Amaza, stated at the training in Awka, capital of Anambra, that solar powered storage for hospital supplies; farm produce; perishable food commodities; and other small businesses such as ice block production and sale, are potential revenue earners and savers for small businesses in the health and services business sectors.
According to Amaza: "Standalone solar home systems which could be offered on a pay-as-you-go basis for lighting and basic needs are also options businesses could explore.
"Small holding kiosks in urban and semi urban environments could use them to keep their businesses open longer than they would have if there was no means of electricity."
The workshop in Awka was attended by 80 participants cutting across different sectors including academia, artisans' unions and market associations.
Citing cases that have worked
To better appreciate their thoughts, both Malo and Amaza provided examples of DRE solutions that have worked for small businesses across Nigeria.
They pointed out that SOSAI Women Solar Dryer Program which has a lease to own model; GoSolar Africa, a solar re-purposed refrigeration and storage system; ColdHubs, a walk-in solar-powered cold stations; and Quintas Renewable Energy Solutions biomass off grid power solutions, were some of the DRE solutions that have helped businesses grow their profitability and service deliveries without relying on erratic Discos' supplies.
"For only about N200, farmers dry a bag of pepper through an innovative solar-powered pepper dryer installed by Sosai Renewable Energies Company, which is connecting rural women farmers with renewable energy powered agricultural processing technologies.
"Sosai's Innotech 18-meter tunnel solar dryer is able to dry peppers of farmers faster in two days as against five days that it would take on the average to dry directly in the open field. The dryer cost 12,000 euros and is kept with a farming community which rent out the use of the dryers to users for between N200 and N500 per bag. Proceeds from this are used to pay back the cost of the dryer in instalments," Malo, explained.
She also stated that GoSolar Africa provides solar refrigeration kiosks that operate with pure sine wave Maximum Power Point Tracking (MPPT) intelligent equipment which can transform direct current to stable alternating current.
"These are solar powered refrigerator or kiosk capable of extending shelf life of foods and farm produce between two and 21 days. Customers pay about N50/kWh of storage capacity to use the kiosk.
"In addition, Go Solar operates an entrepreneurship business model that engages association of women; farmers and youths across Nigeria. Customers and farmers take their farm produce to a nearby cold kiosk and deposit with operators for storage, and users don't have to purchase a cold kiosk but can simply pay per use - the Pay-Go model," she added.
According to her, GoSolar usually re-purposes discarded fridges and convert them to solar fridges.
She noted that it involves also setting up cold rooms for storage of vegetables and perishable produce, stating: "Farmers and market women are targeted in developing the product considering that preserving their farm produce and leftover wares is still challenging to them."
Amaza, on his part, explained that Quintas Renewable Energy Solutions fabricates simple agro-processing machinery to process farm gate produce beyond primary raw material levels.
He said: "Solutions include single and multi-stage pressure and velocity compounded steam turbines for off grid distributed electricity generation. Turbines come in four models with power output of 100kW, 250kW, 500kW and 1MW, and boilers that accompany turbines could use forest and agro residue or processed municipal wastes as fuel for steam generation in agro processing industries, amongst other users."
Businesses most suited to benefit
Citing a 2013 report from the National Bureau of Statistics (NBS) and Small and Medium Enterprises Agency of Nigeria (SMEDAN) on the status of MSMES in Nigeria, they disclosed that Anambra State for example has 1,223,395 MSMES which generated 1,441,047 jobs distributed amongst 741,653 males; and 699,395 females, while Kaduna State has 1,635,453 MSMES that provided 2,367,461 jobs distributed amongst 2,071,929 males and 295,531 females.
This also included 2,712 small scale enterprises and 170 medium enterprises which collectively provided 114,132 jobs with men holding 30,645 of these jobs and women holding the remaining 83,487 jobs.
Malo and Amaza said small businesses in agriculture, health services; retail and wholesale trade, as well as manufacturing and water services, were perhaps best suited to benefit from simple DRE solutions.
Malo in further explanations stated that there is a need to step up promotion of solar and other renewable energy sources, with active emphasis on its economic benefits, as well as develop acquisition models to drive up usage and deployment of them amongst small businesses.
She said: "For instance, a social enterprise called Babban Gona believes smallholder farmers hold the key to Nigeria's agricultural future, and so provides them access to enhanced, high quality, cost-effective training, financial services, agricultural inputs and marketing services. The Babban Gona cooperative has over 20,000 farmers within its network. Most of them live very far electricity grid. If DRE operators work with the Babban Gona cooperative to scale these solutions, we believe there will be a lot of benefits to be gained."
Malo emphasised on the need to educate MSME operators on the financial benefits of power from renewable sources over fossil generated power because they can afford it, adding that a sustainable mechanism for grants to install and operate renewable energy solutions such as cold storage and agro processing solutions and irrigation pumps, with repayment plans could be a profitable opportunity to maximise.
"MSME clusters such as sawmills; grains threshers; and fishmongers can be helped to collectively procure and install renewable energy solutions for their operations. Sawmills and threshers could leverage the biomass turbines and boilers solutions of Quintas, for example to power their operations using residues generated, while fishmongers could leverage the cold storage and dryers solutions available," added Malo, in this regard.