Ahead of Meetup Africa, TowerXchange speaks with Aida Diouf, Executive Director, Africa for Camusat's Aktivco, about how the ESCO is scaling to meet Africa's growing energy, sustainability and efficiency needs.
TowerXchange: Please introduce Aktivco and your ESCO presence in the telecom African market, how did you grow to achieve your current scale?
Aïda Diouf, Executive Director, Africa, Camusat:
Aktivco, the infrastructure division of Camusat Group, is dedicated to supporting our clients in their infrastructure modernization and efforts to reduce their carbon footprint by offering outsourced management of passive infrastructures.
Established in 2016, we signed in 2017 our first contract in Chad for 500 ESCO sites and we have since expanded our operations across six other African countries: Niger, Burkina Faso, Côte d'Ivoire, Cameroon, Senegal, and Madagascar. We currently own and manage over 7,000 ESCO sites.
Today, Aktivco stands as a prominent player in passive infrastructure management of the global telecom market, and we target further expansion to new territories and customers.
TowerXchange: Africa faces a massive energy gap, and tower network rollout is accelerating much faster than grid connections, how do you support the MNOs in closing this gap?
Aïda Diouf, Executive Director, Africa, Camusat:
Indeed, we support MNOs to promote sustainable connectivity and access to technology while extending and managing the network in line with the carbon reduction targets of the telecom environment. Our approach relies on renewable and decentralized energy solutions, including solar panels.
For example, in the Ivory Coast we are collaborating with Vanu for the deployment and operation of a full sustainable tower & power business model for up to 700 ultra rural sites by 2025. In our rural deployment efforts, we prioritize technically optimized solutions that encourage mobility and autonomous energy usage.
TowerXchange: How is the ESCO market going to secure the scaling capital that is needed?
Aïda Diouf, Executive Director, Africa, Camusat:
There is a discernible surge in the interest of impact investing, where investors actively seek financial returns in tandem with generating positive social and environmental impacts. ESCOs have indeed become an appealing destination for impact investors who are enthusiastic about funding initiatives aimed at enhancing access to clean energy in Africa.
Our Aktivco’s business partners with global investment funds focused on green assets to further facilitate Aktivco's growth and reach its ambition to become a key “Infra & Network as a Service” player focused on environmental-friendly solutions.
However, to secure the necessary scaling capital for the industry's growth, there are additional avenues that can be explored:
Engaging with local and regional banks to secure loans or credit lines for projects could prove instrumental for ESCO’s development. These banks possess an intimate understanding of local market conditions and dynamics, making them valuable and complementary players in the financing landscape.
Government incentives and subsidies are another promising avenue. Governments can play a pivotal role by offering incentives, subsidies, or tax breaks that not only encourage ESCO investments but also render ESCO projects more appealing to a broader spectrum of investors. Such initiatives can significantly contribute to the industry's expansion and its alignment with broader environmental and sustainability objectives.
TowerXchange: Many MNOs have set their energy strategy, how are you helping them deliver operationally on their goals?
Aïda Diouf, Executive Director, Africa, Camusat:
We strongly advocate that MNOs focus on the growth of their core business while building strong partnership with experts able to deploy and manage their sites as a service. We also believe that MNOs should move to the new technologies by restructuring the concepts around the existing active infrastructure to reduce even further the energy consumption of their network.
As a long-standing partner of Mobile Network Operators (MNOs), we view their targets within our sphere of influence as our own challenges, especially concerning their ambitions to reduce Scope 3 greenhouse gas (GHG) emissions.
Sustainability has been a foundational principle guiding our Group's development in recent years. We were early adopters of environmental initiatives, as evidenced by our first Corporate Social Responsibility (CSR) report for 2014.
In 2021, we took a significant step by releasing our inaugural carbon footprint, encompassing Scope 1, Scope 2, and Scope 3 emissions. This milestone enabled us to formulate action plans in 2022 aimed at reducing our own greenhouse gas emissions.
Building on this commitment, we are further reinforcing our dedication to setting emissions reduction targets in alignment with the criteria and recommendations outlined by the Science-Based Targets Initiative (SBTi). This strategic move will provide a comprehensive view of our transition toward a low carbon footprint, a metric of importance highlighted in the Carbon Disclosure Project (CDP) questionnaire.
Additionally, our group is actively in the process of defining its energy strategy beginning 2024, with a clear objective of achieving zero on-site fuel consumption by 2050.
Furthermore, our technical solutions play a pivotal role in optimizing energy consumption for our clients. Since 2017, the implementation of our energy solutions has contributed to saving over 127,000 tons of CO2 emissions within the framework of our ESCO contracts. These tangible results underscore our unwavering commitment to sustainability and our role as catalysts for positive environmental change.
TowerXchange: MNO ESG goals require them to have greater visibility over their carbon footprint. What tools have you adopted to allow operators to fully understand their on-site energy consumption?
Aïda Diouf, Executive Director, Africa, Camusat:
First, comprehension and rigorous evaluation of energy consumption has become a fundamental element of our ESCO contracts. We have introduced specific SLAs, such as the Green Energy Ratio, in which we pledge to achieve a certain percentage of green energy utilization compared to conventional grid and fuel-based sources when delivering our services. In addition to fully solar-powered sites, we are always exploring the possibility of backing up grid-connected sites with solar solutions."
Then, ESCOs provide clients with a comprehensive understanding of their energy consumption through a range of tools and services. These tools help identify areas for improvement and enable clients to track progress toward their ESG (Environmental, Social, and Governance) goals.
Some of our wide range key offerings include the deployment of smart metering solutions that accurately measure and report energy consumption. These meters provide real-time data, allowing clients to monitor usage patterns and identify opportunities for efficiency enhancements.
Additionally, at the start of and during the lifetime of a contract, we conduct thorough energy audits to assess the current state of a client's energy usage. These audits reveal inefficiencies and opportunities for optimization in various aspects of energy consumption.
We also work with customized reporting and dashboard solutions that present energy consumption data in an easily understandable format. It gives us clear insights into the energy performance and sustainability efforts.
As for implementation, remote monitoring and control systems are set up to enable us to manage and adjust equipment settings and schedules from a distance. This capability enhances efficiency and allows for proactive energy management.
One extremely interesting point is our Lifecycle Analysis approach. As part of our carbon footprint monitoring, we perform lifecycle analyses, evaluating the environmental impact of energy consumption throughout the entire lifecycle of equipment and infrastructure. This comprehensive view aids in sustainability planning and decision-making.
By leveraging these tools and services, the clients are empowered to make informed decisions, reduce energy consumption, and progress toward their ESG goals, all while optimizing their energy management strategies.
TowerXchange: ESCOs and towercos are both expanding their energy service offering to MNOs, how do you see the relationship dynamic between yourself and towercos, and how will this evolve?
Aïda Diouf, Executive Director, Africa, Camusat:
Given their prominent position in terms of number of telecom sites across the continent, towercos should play their role in shaping the energy trajectory of the sector, with potentially massive implications for the climate.
To assist them in addressing these critical energy-related challenges, Camusat Group provides comprehensive support through our Opco division. Camusat Opco offers turnkey solutions for power generation, both on-grid and off-grid, as well as managed services. However, it’s important to note that these services do not involve direct investments.
In this context, we view the dynamics between towercos and ESCO as two complementary elements within the broader spectrum of solutions offered to MNOs. It's noteworthy that, up to this point, we have not observed towercos responding to an ESCO RFP, underscoring the distinct segmentation between the two.
TowerXchange: We are seeing increasing synergies between energy and managed services. How do you see this evolving the ESCO and MSP business model?
Aïda Diouf, Executive Director, Africa, Camusat:
At the core of Camusat Group's identity is the integration of both the ESCO and MSP business models. Since our inception, we've made a deliberate effort to combine our dedicated investment know-how (Aktivco) with our global expert operational workforce (Camusat Opco). This strategic approach allows us to effectively address the telecom sector's increasing demand for outsourcing telecom infrastructure.
As of today, Camusat Group is actively engaged in the operations and maintenance of both active and passive equipment on over 25,000 telecom sites worldwide.
This innovative approach has been notably popularized by the big MNOs recognizing the intrinsic value of having a single point of contact to address all aspects pertaining to the performance of its passive infrastructure.
Operating in this manner offers a multitude of advantages. Firstly, it fosters a profound understanding of the operators' network, leading to more informed decision-making and tailored solutions. Additionally, this integrated approach is favourable to optimizing operational costs and, significantly, reducing CO2 emissions, thanks to the synergies of the two activities.
TowerXchange: How do you see the role of ESCOs evolving in the African landscape, both in short-term pipeline and long-term expansion?
Aïda Diouf, Executive Director, Africa, Camusat:
There is a rising interest among MNOs in ESCO business models exemplified by the fact that every African MNO has recently launched an ESCO Request for Proposal (RFP) in at least one of these countries.
This growing interest can be attributed to 3 main compelling factors:
1) Mid and long-term carbon footprint reduction commitments for which ESCO models offer a practical avenue to achieve these sustainability goals.
2) Limited ARPU in emerging markets leaving limited room for extensive investments in capital intensive new infrastructure deployments and thus, willingness to minimize capex associated with passive infrastructure.
3) Expanding needs for rural coverage and the deployment of new technologies.
We anticipate that this trend will continue to gain momentum in the years ahead.
Today, Camusat Group currently operates in 14 African countries, which provides ample opportunities for us to expand our ESCO presence and capitalize on the industry's growth. We hold a strong belief in our capability to oversee more than 10,000 sites by 2025.
Want to learn more about Aktivco's growth plans across Africa? Join TowerXchange Meetup Africa on 17-18th October to continue the conversation and meet Africa's telecom tower energy teams in person.