How To Start A Lucrative Renewable Energy Business In Nigeria: The Complete Guide
For thousands of years, the world has depended on non-renewable energy forms ranging from firewood to crude oil. However, given the increasing global population and the growing energy demand, it has become crystal-clear that we might soon run out of energy sources if we continue to depend solely on wood and fossil fuels. In response to this, several nations of the world have begun to adopt energy sourced from inexhaustible natural sources such as wind, water, coal, oil, the sun, biomass, geothermal heat, etc.
In 2017, over 19% of total global energy consumed was drawn from renewable energy sources, and the adoption has grown significantly ever since. More countries of the world have now adopted renewable in part and in full. Iceland and Norway now generate all their electricity from renewable sources. The market size of renewable energy was valued at $928 billion and is projected to grow to $1.5 trillion by 2025 at a 6.1% CAGR. Several countries of the world have taken to generating renewable energy mostly for internal use. Iceland tops the list with a massive 19 TWh per annum. They produce all 100% of the power consumed from renewable sources. They are trailed by Norway, Kenya, Sweden, Germany and China.
Nigeria, however, still underutilizes her capacity to generate renewable energy. Situated close to the equator, Nigeria can generate all her power need using solar energy alone, but the present reality is that the renewable energy sector of the country still has ample room for improvement. In most Nigerian cities, including Port-Harcourt, Lagos, Abuja, Calabar, Benin, and many others, streetlights are powered by solar energy. Also, solar energy is used to power many homes. Notwithstanding, the sunlight energy is just one of many forms of the renewable energy sources available for exploration in the country. In a few years, the interest in more renewable energy forms is bound to grow, especially given the erratic electricity grid. This makes renewable energy a highly lucrative business venture for businesspersons and investors.
If you would like to start a lucrative renewable energy business in Nigeria or Africa at large, here is a detailed step-by-step guide to help you.
What Is Renewable Energy?
Renewable energy refers to energy derived from natural resources such as sunlight, wind, water bodies, geothermal heat, biomass, etc. They are termed ‘renewable’ because they are inexhaustible, and their sources are replenished by natural phenomena.
What Is A Renewable Energy Business?
A renewable energy business incorporates all the opportunities involved in harnessing natural resources into energy supply.
Business Opportunities In Renewable Energy Business In Nigeria And Around The World
1). Biofuel Production:
Biofuel production is an entirely lucrative opportunity for anyone at any level. It involves producing fuels using recycled waste materials such as algae or ethanol derived from sugarcane and other grains. Biofuel is in high demands in most industrial countries, and it has tons of advantages over fossil fuels.
2). Solar Panel Supply:
Given the gradual shift from the electricity grid to the dependent solar energy, the demand for solar panels and related devices is on the rise. This creates opportunities for businesspersons who are interested in distribution.
3). Solar Panel Installation:
Another opportunity related to solar energy is Installation of the solar panels. Installing a solar panel and connecting it to the power supply system in an apartment or a streetlight setup, for example, requires the services of trained personnel.
4). Sales Of Inverters, UPS And Other Equipment:
Selling energy generation or storage devices such as inverters, panels, UPS, etc. is a great way to make your cut off the renewable energy business.
5). Repair And Maintenance Services:
Devices and machines used in the production of renewable businesses require constant checkup, servicing and repair services. This creates an opportunity for engineers and technicians in the field.
Facts And Benefits Of Renewable Energy
- Renewable energy is without limit
- It is safe and easy to use.
- Renewable energy gives off very low gas emissions and is eco-friendly.
- It poses fewer health hazards than other energy types
- It creates lots of job opportunities for people across the globe
- Renewable energy removes threats of pollution
- It drives development and economic growth.
- Involves very recurrent expenses
- It is highly reliable
- The renewable energy business is highly profitable, given its teeming demands in recent years and its high prospects.
- Iceland and Norway are by far the biggest users of renewable energy at the moment.
- Renewable energy takes diverse forms, including solar power, hydropower, biofuel energy, etc.
- It fosters economic independence of nations and less dependence on imported fossil fuels.
Types Of Renewable Energy
1). Solar Energy:
Solar energy is the energy derives from the sunlight. It is perhaps the most available renewable energy form, and it is easy to harness for diverse purposes, including power supply, heat during cold weather, etc. The solar panel is the most common device used to convert the sunlight into solar energy.
2). Hydro Energy:
Like the sun, water has been there for mankind since the beginning of time. The hydropower is converted into electricity supply through dams and reservoirs. Hydropower is essential for large-scale commercial production, and the energy derived from it can be stored and distributed across far distances.
3). Biofuel Energy:
Biofuel energy is an impressive way to recycle organic waste for the production of non-fossil fuels. The biofuel energy is a lucrative business anyone could delve into, but because of its tasking process, it is best practised on a large scale.
4). Geothermal Energy:
Geothermal energy involves harnessing the heat from the ground either as pure heat or transforming it into electricity. Geothermal energy is much easier to work with in regions of the world with temperate heat than in the cold areas.
5). Wind Energy:
With turbines, the wind could be converted into energy to supply electricity to a place. This is a common practice on farms in developed nations. With the right tools and application, wind energy could be used to power up large farms sufficiently.
6). Tidal Energy:
This is the form of renewable energy derived from ocean waves. The currents of the tides are timed and converted into energy which can be converted into electricity. Sea tides are not always high enough to generate power, but they are predictable, and that makes it easy to time.
How To Start A Renewable Energy Business In Nigeria: A Step-By-Step Guide
1). Decide On A Niche:
The renewable energy business is particularly broad and diverse. This implies that you need to pick a specific renewable energy type to practise.
2). Gather Enough Information:
This is the point where you study your chosen field of focus. Check out the feasibility of the selected energy form in your locality and the success rate of such as business.
3). Create A Business Plan:
The businessperson’s handbook, a detailed business plan, comes in handy each time you want to start a business. Create a business plan that contains all the goals, steps and decisions you plan to make at every stage of the business.
4). Invest In Tools And Manpower:
Every form of renewable energy requires tools, devices and sometimes machines. They also need the right experts to handle them. Procure the most basic tools and employ the required personnel.
5). Register Your Business:
Make your business a legal entity and register it with the Corporate Affairs Commission and other related state boards. You also need operational permits to produce energy on a large scale.
6). Locate Your Customers:
Before your business can swing into full motion, you have to locate your customers/clients. Create awareness of your business via means such as online ads, networking with other companies in the field, etc.
Challenges Of Renewable Energy Business In Nigeria
- Renewable energy could be capital-intensive for young entrepreneurs
- It requires a lot of labour and machines
- For some energy types, the process could be tasking
- Competition with food production
- Some energy forms are affected by weather conditions
- Difficulty in tapping into energy resources
- Difficulty in securing loans from financial institutes
- Low adoption of renewable energy, especially in developing countries.
- Renewable energy requires a large mass of land
- High maintenance costs of machines
- Some energy forms consume lots of resources
- Limited governmental support for renewable energy investors
To Sum It Up
The shift from fossil fuels to renewable energy might be slow, especially in Nigeria, but its full adoption is imminent. The prospect for renewable energy is massive, given that the world is becoming more and more conscious of preserving natural resources. The renewable energy business in Nigeria can be a lucrative and profitable venture to start-up, due to its vast market demand and on your ability to build a wide network. If you’re looking for a lucrative business to venture into, the renewable energy business in Nigeria is a great option to explore.
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