Akli Brihi – Country President, Schneider Electric Algeria
The country director of Schneider Electric Algeria talks about energy management in Algeria, the solutions its brings to make it more efficient and the strategic importance of the country in terms of energy in the region and for Europe.
You became head of Schneider Electric Algeria (SEA) last September and you are a former BP executive. Can you tell us about your career in the oil and gas sector, and shed some light on what you intend to bring to Schneider Electric in the country?
Indeed, I spent seventeen years at BP with my last job as President of BP Algeria. It has been a quite exciting journey where I have been able to gather experience across the full energy value chain, from upstream oil & gas with BP, then in power generation with General Electric, and today in power distribution with Schneider Electric.
My priority now is to reposition SEA in the Algerian energy market, notably in Oil & Gas where we could serve this market with our entire product and services portfolio range, from electrical distribution to process automation thanks to the acquisition by Schneider Electric of Invensys.
What are SEA’s strengths as compared to its competitors in the country?
Schneider has a long standing and historical presence in Algeria. We are very much local – with a local team expertful in managing electrical distribution turnkey projects as well as servicing the huge installed fleet we have in country.
In 2013, Schneider’s growth amounted to thirty percent. What about 2014 results?
Although we do not have the consolidated figures yet, we did not grow as expected due to the slowdown on many public infrastructure programs. 2015 looks much better and we should be able to do more and support Algeria’s economic development. The government has announced a number of projects, including the 2015-2019 five-year development plan of 262 billion USD to support the needs of the country in energy, transportation, healthcare, buildings, etc… In all these infrastructure projects, power is essential. Schneider Electric is on to support that program.
Domestic consumption is booming. You have declared that the rationalization of national consumption was crucial, maybe even more than the discovery of new fields. What does this entail?
The energy model as at today is costly to the Algeria Treasury. As energy is heavily subsidized, the people of Algeria do not pay the real price for electricity and fuel. If we intend to continue to subsidize in this way, we will have somehow to implement energy efficiency programs in order to balance out the massive expenditure.
Saving energy in a significant way is as critical as investing in new oil & gas fields. In my view, the current energy model is no longer sustainable. We would need a political awakening to shift the model.
What is the position of SEA in this perspective?
Schneider Electric as a global specialist company in energy management has a solid track effort on energy efficiency programs by auditing and advising in energy saving deals. For instance, there are categories of End users such as electro-intensive industries which are really motivated in saving the cost of energy.
Ultimately we can support governmental efforts to foster those energy efficiency programs as well as the renewable agenda such as solar.
You have worked in the oil sector for a long time. Today, a great part of your business is with Sonelgaz and power generation. What cultural differences have you noticed?
Sonatrach has ambitions to recover its hydrocarbon reserves over the next 10 /20 years. So as you can imagine, the oil and gas industry is very much capital-intensive with long delays, huge technical and financial challenges. Sonelgaz, the Algerian utility company has big ambitions too but they are more short term and domestic wise. It is vital to meet the needs of the country on power. Sonelgaz’s strategy is to generate power and distribute it at every corner of Algeria – safely, reliably and immediately. A huge job given the size of our country. Given the growth of electricity demand, Sonelgaz has taken up the challenge of doubling its power capacity over the next 5 years. This represents a massive investment across the power value chain from production to transport and distribution. A massive effort on capex and project management to achieve in a short timeframe what was done in 50 years following the independence of the country.
Both sectors remain much focused on Sonatrach and Sonelgaz’s actions. Do you have other market opportunities for your solutions than those two national groups?
Indeed. Although these two companies represent a source of vitality for the sector, we work a lot with other categories of customers, especially with our transactional business products. Thus, Schneider has established the largest network of distributors and contractors in the country, which promote Schneider’s brand and products. We also deal direct with our industrial customers base that fall outside the oil sector: pharmaceuticals, food processing, steel and mining, water among others.
Your assembly plant operates from Cheraga. To what extent is this plant an edge in your strategic positioning?
Schneider’s strategy is long-term driven. The group has been present for over 50 years, through the brands of Merlin Gerin, Télémécanique and now Schneider Electric. This presence was recently reinforced with the acquisition of Invensys – with services very much dedicated to the oil and gas sector in Algeria.
Play “Glocal” is the DNA of the company, i.e working locally with the best international standards. Moreover it is during the middle of the “black decade” that the group invested in Algeria with the creation of a local branch, a plant and a logistics center which distributes our products all across the national territory. Last but not least, we run a successful certified training institute which addresses the needs of numerous customers on electrical distribution, process automation, electrical safety, etc…. . One of Algeria’s challenges is obviously the upgrade of skills. We signed a major partnership with the French and Algerian governments to create a center of excellence in highly innovative training courses, such as industrial automation, renewable energy, and energy efficiency. These courses hardly exist in Algeria, and will enable us to meet the future needs of the country in terms of skilled labor.
Schneider is and will remain an Algerian company. the added value which the company develops locally will remain strong and meaningful, in terms of localization, training, know how, and technology transfer as well, for it has the potential to meet the future energy needs of Algeria.
How would you advise the investors who wish to invest in this country?
For Schneider Electric, Algeria has a very important strategic place among the top ten countries for our group, especially regarding the oil and gas sector.
Algeria has the ability to become a regional power able to serve at its doorsteps Europe – one of the biggest consumption markets in the world as well as Africa – a promising land of business opportunities. Algeria is at the crossroads of building a diversified economy even though I believe Oil & Gas will remain a key pillar.
Algeria is looking for long term partnership with companies keen on technology and know-how transfer, and I believe that there are many business opportunities to catch up for players ready to play “glocal”.
Ultimately having the best people and local partners who have a huge expertise and passion in doing business in such a demanding environment like Algeria are a must.