6 February, 2023 Member article

ARE Member LydetCo goes off-grid

28 January 2023 – On the Ethiopian capital’s outskirts, at about 400 meters from the Ayat roundabout, sits a sparkling white building with the logo LydetCo plastered all over it. A casual glance at the six-storey building reveals little to leave a lasting impression, but a closer look and one notices that no electric power lines are extending to it.

The building was operational since the dawn of the new year and solely relies on the cascading 108 solar panels on the top floor, with the design and installation of the solar system costing 2.5 million Br. The energy production of this building peaks at around 160Kwh day in the dry season, dwindling to 120Kwh with a cloud cover. The amount is close to the energy consumed by a couple of dozen households.

LydetCo Plc is a company that has been engaged in the import and distribution of solar-powered equipment for close to two decades. Its founder Dereje Walelign is a Civil Engineer who graduated from Addis Abeba University. Born and raised in the capital around ‘Semien Hotel’, he started the company sequential to 14 years of employment at Shell Ethiopia.

Hearing stories of people dying after retirement, sent a sense of urgency for re-evaluation to Dereje. He mustered all the funds he could find and went on a quest for self-employment. He only had a general understanding of the energy sector. British Petroleum (BP) was the only international company at the time sending solar-powered products to Ethiopia, Dereje reminisces. With a paid-up capital of 100,000 Br, he leaped on an entrepreneurial adventure importing items from BP until their exit from the sector in 2011.

Two decades later, LydetCo has a yearly turnover of about 50 million Br and around 25 permanent employees. Thousands of homes retain their lights during power outages.

For Dereje, the idea to construct a building powered by the sun ensued from growing demand in the market to have year-round electricity that is not contingent on the performance of the national grid. The building finalised construction last year and generates about five times more than needed. It has a 24-hr running elevator and power-office equipment for LydetCo and other building tenants.

Ethiopia has abundant solar power year-round, ready for harvest. The International Development Association (IDA) under the World Bank approved a 500 million dollar credit for the country in March 2021 to facilitate universal electrification by 2025.

Mesfin Dabi, a consultant on several projects by the Ministry of Water & Energy, sees LydetCo’s approach to the energy sector as extremely promising. He outlined the benefits that a system of this caliber offers to the environment, the national grid and the companies that use it. The expert emphasised the heavy toll on the environment diesel power generation creates in factories.

He believes solar power offers an expansion of capabilities for the public. The data gathered by looking at power usage for companies using a system like LydetCo’s is helpful in decision-making.

Mesfin suggests solar as an alternative energy source for small-scale factories, reasoning spending a couple of million Birr at the start is minuscule considering long-term payback periods.

“The grid system is overloaded,” he said. “Solar offers an ideal alternative.”