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MTN’s Power-Generating Issues

Mobolaji Aluko

alukome@aol.com

Monday, January 5, 2004

INTRODUCTION

MTN recently stated that it currently has 670 GSM bases stations around Nigeria, that it generates 50 MW of power daily, consuming 1.5 million liters of diesel daily. That is roughly 75 kW (that is, 75 KVA) per base station, and at almost N50 per liter now (sigh!), that is almost N75 million per day, or N27.4 billion per year on diesel alone!

All of that sounds pretty high to me. So, some quick back-of-the envelope calculations here.

SOME ENERGY CONVERSION CALCULATIONS

50 MW per day is (50 x 10^6) Joules per second x (60 x 60 x 24) seconds per day

= 4.32 x 10^ 12 Joules per day

that is, if what we have is a constant 24-hour power generation.

Now, burning 1.5 million liters of diesel per day is equivalent to burning a fuel with energy content of roughly:

1.5 x 10^6 liters per day x 36.4 x 10^6 Joules per liter

= 54.6 x 10^12 Joules per day

However, the thermodynamic conversion efficiency of thermal power generation is anywhere from 25% to 33% (this could actually go as high as 38%), meaning that either that amount of diesel burnt per day should generate:

0.25 – 0.33 x (54.6 x 10^12) Joules per day of electric power (or 158 - 211 MW),

or that MTN on really needs:

3 – 4 x (4.32 x 10^ 12) Joules per day (or 0.356 – 0.475 million liters per day)

SOME SAVINGS – AND WHERE IS NEPA?

That is roughly one-fourth of MTN’s current stated diesel needs, which would save it and its customers a bundle – something like N56 million per day!

Something to think about, MTN! Maybe there can be some savings somewhere, even if we include the need to light the base station premises and telecommunications transmitters?

The larger issue, of course, is that MTN is not a power-generating company but a telecommunications company – and that that crucial intersection between electricity and telecommunications (and other technological infrastructure) still needs to be seriously addressed in our country.

But that issue of NEPA being a stand-by rather than a main power-generating source for companies such as MTN is the topic of another symposium.

In the meantime: Happy New Year!

NEWS ITEM

http://allafrica.com/stories/200312290867.html

Mobile Week With GSM: Our Plight, Our Promises And Our Expectations, Wood

Vanguard (Lagos)

December 29, 2003

Okoh Aihe

Boss of the mobile phone company, MTN, Mr. Adrian Wood looked like a man misunderstood penultimate Saturday when in a rare frank talk with journalists at a Workshop midwifed by the Nigerian Communications Commission (NCC), submitted that in spite of all concerted attempts by his organization to satisfy the demands of subscribers, nothing seems to have worked perfectly as each measure is like a flash in the pan.

Peering into the overwhelming statistics of the industry, Wood informed that the industry needs between $11 to $12 billion to grow. MTN is committed to $1.4 billion. He pointed out that "just to ease our pains, we need to uplift others to grow."

Wood did not hold back on any issue because there were so many to speak about. The network is in dire straits as subscribers are unable to make calls. The organization is being accused of stalling on interconnectivity with other operators; and only recently too it went to court to challenge the NCC's new position on interconnectivity concerning rates. In fact, any deficiency in the GSM sector people would readily ascribe to MTN.

Mr. Wood stood his ground to explain every tiny step his organization has taken to bring phones to the Nigerian people, summing up that MTN gets most of the blame because it has the biggest network with 1.5 million subscribers which may be the sum total of all the other networks put together.

Chief Regulatory officer, Engr. Ernest Ndukwe confirmed this when, speaking at the same forum, he confirmed that MTN's 1.5 million lines is as big as the other networks put together. He cited this as the reason most of the complaints mount against MTN as the lead player in the sector, but explaining that what is happening in the telecom sector goes beyond MTN and the other operators. The problem, according to him, has mounted since independence.

In his words: "Nigerians have always wanted telecom facility. The country was rich enough to afford it but didn't have it."

Engr. Ndukwe counselled that operators should double their efforts so that in future, switching and not transmission should be the problem.

But there seems to be a general feeling that if the telecom operators, especially the GSM operators, anticipated problems in the sector, they have not reacted adequately.

To this, Mr Wood made his submission, explaining the efforts his organization has made in reaction to the myriad of problems which nevertheless looked miniscule, hinting that MTN is prepared to do more always, in order to attenuate the plight of the subscribers.

Here is Wood's checklist:

*·Power: While acknowledging government's efforts at reforming the sector, he informed that MTN generates 50 mega watts of power daily and this consumes a million and half litres of diesel. The generators work so hard that they have to be replaced every three months. This month, we are replacing 150 of them.

*·Base Stations: MTN has 670 base stations working at the moment; the figure is expected to hit 5,000 in the next three to four years. The demand is so high, according to him, that most new base stations just take a few minutes to be saturated. For instance, the 7th base station in Aba was soaked in just 20 minutes, while the one in Asaba was gone in one and half weeks.

*·Security : He noted that security of people and assets of the company enjoys high visibility on their priority scale. At the moment MTN has 2,500 security personnel.

*·Personnel: In the middle of the year MTN was employing 10 people every day. The effect, according to his submission, is that the company has 1,600 employees out of which 92 are experts. He pointed out that the transfer of knowledge in MTN is very high. He also informed that MTN is about the only GSM operator that could trust Nigerians with very high positions, such as the Chief Marketing and Strategy Officer, Mr. Afam Edozie, and the Chief Technical officer, Dem Eleso.

*·Interconnection: We provide more interconnection than NITEL does. In the case of GSM, we provide more interconnectivity for the new operators than we did for Econet. As for NITEL, it has been able to provide more interconnectivity for us but which we have not been able to take up at the moment. He also noted that imposition of interconnection rates might hamper growth in the networks but informed that the seeming misunderstanding between MTN and the NCC was going through some frank discussions at the moment.

*·Facility Sharing: An issue that most Nigerians have wondered about as it could impact on cost of service provision, Wood introduced some hope when he explained that MTN has been in the forefront of discussions to share facilities like power and base stations with other operators, noting that in some places, facility sharing was already in progress with NITEL and Starcomms.In spite of all these efforts however, problems remain in the network. While informing that congestion hiccups on the MTN network would be over sometime in January, Mr. Wood submitted that except others begin to perform at maximum level the way his organization is doing through guaranteeing expansion, there would always be problems in the sector.

He once again informed that GSM service was not cheap any where in the world, insisting that in Nigeria, cost looks out of the ordinary because so many people are paying for the mobility they don't use. They sit in one place making calls and thus pay for mobility they are not using.

On the dispute arising from interconnection misunderstanding between the GSM operators and the NCC, Mr Wood hinted that the case was being discussed mutually with greater understanding. But Engr Ndukwe explained that the development would not impact on the industry negatively, instead, it was a welcome development for the entire industry.

According to him: "We are not annoyed that operators have gone to court. It's normal and encouraged. We are not worried about the case. It is good for the industry."

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