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Sub-Saharan Africa To Invest $8bn in Electricity Metering Over Next Decade

March 2, 2016

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Sub-Saharan Africa is experiencing strong growth in its power sector due to electrification programs and robust GDP growth. But distribution utilities are struggling with their inability to collect sufficient revenue from customers and resulting financial unsustainability. In order to help solve some of these problems, Africa will invest $8 billion in electricity metering infrastructure over the next decade, according to a new study by Northeast Group, LLC.

"Utilities in Sub-Saharan Africa must urgently upgrade their poor metering infrastructure," according to Ben Gardner, president of Northeast Group. "Nearly one-third of the power produced in Africa is never properly billed to customers. This means utilities do not generate sufficient revenue to maintain their networks and fund necessary expansion."

The continent is currently a global leader in prepaid metering, where similar to mobile phones, customers pay in advance for their electricity usage. The prepaid metering market still has significant room for growth, beyond its current market penetration of just over 40%. In addition, towards the later part of the decade, more sophisticated advanced metering infrastructure will begin to grow in select countries.

South Africa, Nigeria and Ghana are already selectively deploying smart meters. Nigerian utilities in particular have recently announced ambitious plans for AMI metering following recent utility privatizations and tariff adjustments. There are also significant opportunities in the commercial and industrial (C&I) metering market segment over the next decade.

The competitive landscape of Africa's market is comprised of a number of vendors seeking to serve metering deployments. The current market leader is El Sewedy Electrometer which has a number of subsidiaries across the continent, followed by the South African vendor Conlog (partly owned by Schneider Electric). A number of leading global vendors such as Itron, Landis+Gyr, Elster, Kamstrup, Siemens, and others are also active in deployments in a number of African countries. At the same time, Chinese vendors are increasingly active in Africa, including Hexing, Holley, Sanxing, Star, Wasion and ZTE, among others.

Northeast Group, LLC is a Washington, DC-based smart infrastructure market intelligence firm.


Source: Northeast Group, LLC


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