Confidence for Angola’s energy consumers

Angola

Frederico W.L. Pinnock Makilanda, chairman and CEO of Hengye Electronics Indústria, talks to The Energy Year about the benefits of rolling out prepaid electricity meters in Angola and the strategy behind the company’s meter plant. Hengye Electronics Indústria is building a plant to produce water and energy meters at the Luanda-Bengo Special Economic Zone (ZEE).

What will be the benefits of prepaid electricity meters in Angola?
Over the years, the government has made great investments in the energy sector, particularly in electricity and water, such as the Cambambe and Laúca dams or even the new Luanda Bita water supply project. However, the downstream sector is struggling to recover their investments. The two main companies – ENDE, which is responsible for electricity distribution, and EPAL, which covers the water sector in Luanda – are sometimes claiming losses in the hundreds of millions of kwanzas due to the lack of prepaid meters.
Therefore, one of the main benefits of prepaid meters is that not only will consumers have full control of how we are using energy (electricity and water) in our respective homes and businesses and not receive an exaggerated bill at the end of the month but also it will help our national distributors such as ENDE and EPAL to recover their return on investment.
Also, customers will be able to decide to top up, with AOA 5,000 [USD 7.80] for example, and keep track of what they have paid. Consumers will surely have confidence knowing they can manage their consumption.
In the water sector, we have cases where consumers are charged based on an estimation, which is a loss for the government, and also not fair for our population. A small household may be paying the same bill as a big one.

Is this meter strategy in line with Angola’s efforts to step up energy generation?
Absolutely. For instance, we have one of the biggest combined-cycle power plants in Africa in Angola: the Soyo thermal power station. It’s worth more than USD 900 million. The government is investing billions in the hydro sector for the production of energy, so they are looking for a return on those investments as well.
In terms of distribution, we strongly believe the prepaid meters will be a solution. And, with our Data Centre, we will guarantee an excellent management service of our meters and we will also make sure that we have enough capacity to cover areas with no prepaid meters installed yet.

What was the main business driver behind the decision to start this meter manufacturing project?
All of Angola’s meters are imported, and the market is here. That’s why we’ve been negotiating for more than four years to set up a factory here. Most of our components are imported, so why not invest and create local factories? The labour cost is lower compared to many other countries, especially in terms of salaries, which will be in kwanzas. And, we will have a team not just for production, but also for installation and maintenance.
ENDE has more than 1 million clients without prepaid metres, waiting for them to be installed. With the existing meters being imported, if a client’s meter is damaged, they face a long waiting period to replace it. We will have a 24-7 call centre and technical support team to respond to our clients with meter repairs in record time.

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