How American Tower, Eaton Towers, Helios Towers Africa and IHS Towers are investing in new power solutions
Between them, IHS Towers, American Tower, Helios Towers Africa and Eaton Towers own 45,050, or 36 percent, of sub-Saharan Africa’s 124,428 towers. Collectively, they have a footprint in 14 countries, where grid availability and infrastructure varies significantly. All have major plans for investment in energy infrastructure. TowerXchange examines current energy initiatives underway at Africa’s big four towercos, understanding the technologies for which they have an appetite and problem areas they see; a topic which will be discussed in more detail at the TowerXchange Meetup Africa & Middle East being held in Johannesburg in October.
The cost of power and motivations to reduce fuel consumption
Power is the single largest operating cost for sub-Saharan Africa’s towercos and often their biggest headache.
Excluding depreciation and amortization, the cost of power represented 54 percent of Helios’ cost of sales in 2016, with diesel accounting for 35 percent and electricity 19 percent. For IHS Netherlands Holdco B.V. (the subsidiary of IHS which managed the 5,882 towers Nigerian towers outside of the former IHS-MTN joint venture in the country), power represented 49 percent of the cost of sales at June 30, 2016 (excluding depreciation and amortization).
In terms of the challenges presented by power, volatility in fuel prices, fuel shortages, diesel theft, slow interconnection, logistic challenges, electricity price hikes, and poor grid availability are just some of the those faced by towercos on a regular basis. Whilst solutions to tackle these challenges and optimize costs vary on a country by country and site by site basis, one focus remains constant across a towerco’s portfolio; reduce diesel consumption.
To learn more about the African tower market click here.
August 9, 2017