Major French telecommunications companies, including MTN and Airtel, are focusing on renewable energy sources such as solar, wind power and lithium batteries, as diesel costs continue to rise, reaching a staggering N570 billion in just eight months.
With diesel prices averaging N1,426.
09 per litre per month, according to the National Bureau of Statistics, the financial pressure on the sector is mounting.
It is estimated that over 50 million litres of diesel are consumed by telecom operators each month to power their infrastructure.
An analysis by The PUNCH shows that telecom operators spent about N71.
3 billion per month on diesel, accounting for a total expenditure of N570 billion in the eight months from January to August.
Telecom operators turn to renewable energy as diesel costs hit N570 billion September 25, 2024 Telecom FILE: Telecom Signal By Justice Okamgba Major telecom companies including MTN and Airtel, are turning to renewable energy sources such as solar power, wind power and lithium batteries, while diesel costs continue to rise, reaching a staggering N570 billion in just eight months.
With diesel prices averaging N1,426.
09 per litre per month, according to the National Bureau of Statistics, the financial pressure on the sector is mounting.
Over 50 million litres of diesel are consumed by telecom operators every month to power their infrastructure, operators estimate.
An analysis by The PUNCH indicates that telecom operators spent about N71.
3 billion per month on diesel, accounting for a total expenditure of N570 billion in the eight months from January to August.
According to data from the Bureau, the average price of diesel as of August 2024 was N1,406.
05 per litre.
French In July, it was N1,379.
48 per litre, while in June, it recorded a higher rate of N1,462.
98 per litre.
The data further revealed that diesel prices in the previous months were as follows: N1,403.
96 per litre in May, N1,415.
06 per litre in April, N1,341.
16 per litre in March, N1,257.
06 per litre in February and N1,153.
01 per litre in January 2024.
Telecom operators, who are grappling with rising operating costs due to exchange rate fluctuations, said diesel consumption accounts for a significant portion of their expenses.
French diesel plays a vital role in powering Nigeria’s telecommunications infrastructure, especially base stations, which rely heavily on generators due to the unstable supply to the national grid.
A research paper obtained by The PUNCH revealed that over the past five years, a total of 53,460 base transceiver stations have been deployed in Nigeria.
At the end of 2021, Nigeria had about 38,288 base stations, according to the Nigerian Communications Commission, the telecommunications regulator.
However, with plans to adopt solar panels, lithium batteries and grid connections, telecom operators could reduce energy costs by 15-30% annually, according to a McKinsey report.
The report says the exact savings will depend on their current energy management practices and the level of solar integration.
Airtel Nigeria, one of the largest operators with over 60 million subscribers, revealed that it consumes 22 million liters of diesel every month to power its infrastructure.
In May 2024, Airtel’s Director of Corporate Communications and Corporate Social Responsibility, Femi Adeniran, said in Lagos on Monday that the company’s monthly diesel costs stood at 28 billion naira.
French As businesses strive to comply with the United Nations Sustainable Development Goals, reducing their carbon footprint has become a top priority.
Telecom companies are now forced to look for energy-efficient and cost-effective solutions.
Airtel Nigeria CTO Harmanpreet Dhillon said the carrier is focusing on expanding network connectivity and deploying alternative energy solutions across its Nigerian operations.
“The most important factor for us in Nigeria is the network,” Dhillon said.
“Our first target is to connect all our sites to the network because many of our base stations are currently not connected to the network.
“Once we achieve this target, we will reduce our reliance on generators, which will in turn reduce our diesel consumption,” he said.
The mobile operator works closely with electricity distribution companies to ensure grid availability at their locations.
“When the grid is available, our generators will run less frequently, which will directly reduce our environmental impact,” he said.
A senior telecom executive, who requested anonymity, revealed that industry giant MTN, which has about 80 million subscribers, spends more than RMB30 billion on diesel every month to provide baseload power to its roughly 25,000 towers.
The executive told The PUNCH that while some telecom companies have begun exploring green energy sources, infrastructure companies such as ATC Nigeria and IHS Nigeria have been slow to adopt sustainable solutions.
“ATC is more open to renewable energy, investing in hybrid energy, solar and wind power.
However, IHS, which manages about 80 percent of MTN’s tower business, is still heavily dependent on diesel,” the executive said.
Last week, Chukwuebuka Ezewuzie, Senior Director of Business Technology Platform and Growth at MTN, said that a lot of progress is being made in the adoption of renewable energy.
“So how do we use free energy from the sun and wind to power these devices to reduce costs?
This is one of the key areas that telecom operators are currently exploring,” he said.
