“Even though power plants of this nature have been around for decades, primarily information has been available not in the private sector. Today one of the biggest challenges for us is analysing, understanding how power works from this particular mechanism of generation. Secondary, understanding how best to make it efficient for the system,” Eric Olo, the chief commercial officer at North South Power, told CNBC Africa.
“We have to bear in mind that in addition to the technology behind this there’s also the people and the industry as a whole which is involved. In addition to that understanding the dynamics of the economics – there’s a huge amount of investment that’s going to be required to develop the sector.”
Nigeria’s power sector went through a massive change recently when it saw ownership of the generating and distribution companies shift from government to the private sector.
Hydropower could possibly be one of the more promising renewable energy sources in the country.
“Our plan is a hydroelectric power plant. Essentially our main commodity is water and retention of the water for us is critical. At this point, what we are doing is we have full capacity available but we obviously retain and manage what we can disperse based on demands and on what the actual efficiency of the assets should be,” Olo explained.
He added that in future, there has to be investment from international investors to adequately develop the sector.
“A lot of capital for the first round was sourced locally but going forward, a lot of that has to come from international markets and they have to understand the business just as we’re trying to understand it – it’s an ongoing, learning process.”