BusinessTechnologyElectricity meter suppliers in contract goldrush across Africa

Fri,17Nov2017

Posted on Monday, 13 May 2013 12:05

Electricity meter suppliers in contract goldrush across Africa

Transmission stations in Zambia are part of Elsewedy’s expanding network in sub-Saharan Africa/Photo©ALL RIGHTS RESERVEDEgypt's Iskraemeco hopes Elsewedy's contacts will help it face the charge as utilities prepare to roll out new meter technologies.

 

Sub-Saharan Africa lags far behind developed regions in access to electricity, but the market for electricity meters is growing fast as national utility companies seek to deploy prepayment and smart meters.

Companies from the continent, the United States and China are competing for contracts as power companies look to protect their revenue streams.

Egyptian-owned Iskraemeco hopes to cash in on an emerging market.

The Slovenia-based company, acquired by Egypt's Elsewedy Electric in 2007, already controls much of the market in Central Europe.

It also hasa monopoly in Libya and ample sales of smart meters – which allow communication between the meter and a central monitoring system – in South Africa, according to Sherif Kafafi, Iskraemeco's sales director for the Middle East and Africa.

Outside of South Africa, the company sells mostly pre-payment units, which work well in rural areas.

Iskraemeco has a production plant on the outskirts of Cairo and operates assembly lines for prepayment meters in Nigeria and Zambia.

Egypt is a key market, with an estimated 25m households, increasingly more than the country's grid can handle.

Iskraemeco controls roughly 60 percent of the market in Egypt, Kafafi says.

But with the Middle East and Africa accounting for only 20 percent of its sales, the company, which claims about 80m operating meters in total, hopes to leverage the Elsewedy conglomerate's ties in Africa for a bigger share.

"Elsewedy has very good connections in the Middle East and Africa," argues Kafafi.

The Elsewedy group also manufactures cables and turbines, with con- tracts in several sub- Saharan countries.

It has a contract for transmission stations in Zambia.

In Equatorial Guinea, it is working on the electricity network in Evinayong.

It also has a Nigerian contract for fibre-optic cables.

Prepayment meters

The meter manufacturer has made inroads in sub-Saharan countries, with sales in South Africa, Mauritius, Rwanda, Kenya, Equatorial Guinea and Mozambique.

"Due to market specifics, Africa is more inclined to installing prepayment meters.

"Some have trouble collecting revenues from consumers, and the meters with the prepayment functionality are an efficient means of debt management and revenue collection," says Kafafi.

But Iskraemeco faces hard competition from Chinese sup- pliers who offer cheaper alternatives.

Kafafi says the precise statistics on how his company is faring compared with Chinese manufacturers are hard to come by, as indeed are precise statistics on potential markets.

"The information is not really clear. Even if you ask a utility company, they don't have these reports," he says.

Nigerian company Momas Systems, which is developing a manufacturing centre in Ogun State and works with South Africa's Conlog, has a partnership with China's Hexing Electrical to develop smart meters.

In January, the Sudanese government opened a joint Sudanese-Chinese manufacturing plant with the capacity to produce 450,000 meters per year. There is also competition from high-end suppliers.

Last December, US-based Itron won a $150m contract to supply smart meters for Johannesburg utility City Power as part of a consortium with South African group Edison Power.

However, the deal has been mired in controversy with South Africa's opposition calling for an investigation into the tender process.

Actaris, a company owned by Itron, also won the pilot contract for Kenya Power's prepayment rollout in 2009●



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