Renewable energy is a sector on flux. Global greats like Google have risen to the challenges imposed by global warming and rising demand for energy through investments in sustainable power sources. Solar City is one such company that has benefitted from the energy race; Google has invested $280 million so far in the company. For the sake of continuity let’s think of Econet as our local equivalent of a Google of sorts; in such a scenario Econet Energy has a very solid shot at becoming a regional energy titan.
To begin with, the launch of the division on the back of solar lanterns (at $25 a pop) is a mockery of its true potential. Serving Zimbabwe with reasonably priced lighting solutions is great, however for a company generating hard currency (in the hundreds of millions) one would expect mega projects. Perhaps stamping Econet’s logo on Asian sourced lamps is a rehearsal for bigger things to come. We are not quite sure of what the team in Msasa or Johannesburg are planning, judging by recent performance we hope they make full use of this rare opportunity. Econet Energy has a seriously solid foundation to emerge as a continental star. How so?
To the east of Zimbabwe lies Botswana, a tiny nation of just over a million people and plenty of ‘useless’ desert space. The Kalahari Desert covers nearly half of a country blessed with almost 365 days of sunshine. By leveraging on its Botswana interests (Mascom), Econet Energy can transform the Kalahari into a massive power station. This will be a result of setting up an ocean of photovoltaic panels (huge solar panels) across the desert. The obvious challenge would be financing such an operation, in Econet’s case this should not be a hindrance.
The company (through its founder) has an international profile that can enable it to tap into the $55 billion global investment prospects for solar by 2015. This projection is according to a report produced by the European Photovoltaic Industry Association (EPIA) in conjunction with Greenpeace International. Econet Energy can then expand into other barren areas like the Namib Desert and the behemoth Sahara, which is on record as having the capacity to power up the whole continent. It’s not surprising to note that Europe is formulating a master plan to benefit from this of this great desert.
According to an article by Valerie Noury in the May 2011 edition of African Business [sorry no internet link available], the price of solar panels is plummeting as a result of increased production. She singles out Phaesun Asmara of Eritrea, PSC of Nigeria and Asian producers among the champions of this revolution. Besides Solar Energy, Econet can use its Lesotho subsidiary to build wind turbines in the highland nation. With regards to its Burundi subsidiary, approximately 7% of the country is covered in water (It lies in the great lakes region) and this could be a pointer towards a hydro related project.
These opportunities are cast in stone; Econet’s ability to unlock them is yet to be seen. The company is no longer the mobile posterboy of yesteryear, having lost out in frontline markets like Nigeria or Kenya to succeed in smaller and less competitive ones. The continent is now led by MTN, Glocom, Airtel, Tigo and Orange among others. Econet Energy could very well be the gem of the group, along with a Zimbabwean subsidiary that has outperformed other divisions.