Many African countries are investing in alternative energy sources such as solar power to fill the gap. Individuals corporate organizations are also playing a significant role in the energy sector. One of such is Salma Okonkwo from Ghana. Salma’s story is unique because, in Africa, it is rare to find an energy company that is founded and headed by a woman. Today, we explore how Salma Okonkwo built her solar power company, which is one of the largest solar firms in Ghana.
Salma Okonkwo’s Early Life
Salma Okonkwo was born and brought up in the bursting suburb of Kanestie in Accra, Ghana. She was one of the 14 children of a real estate mother and a cattle dealer father. Salma’s dad started as a teacher. During the First Republic of Ghana under Kwame Nkrumah, he became a politician.
Thereafter, he became a businessman. He mainly supplied livestock to corned beef factories and other bulk buyers across the country. Salma’s mother was originally trained as a nurse. She worked at the state-owned airline (Ghana Airways).
She was one of their first hires. Afterward, she took over a real estate and service firm. The real estate firm was responsible for building clusters of bungalows across the city of Accra. Thus, you can say Salma is a chip off the old block. Growing up in an entrepreneurial home must have rubbed off on her.
While growing up, she often visited her grandmother in her ancestral village. Being a member of the Akan clan, a clan whose women make and sell products like sandwiches and smoked fish to provide for their children, Okonkwo had to follow suit. According to her, though these women were illiterates, they knew how to make a margin.
After graduating from an all-girls boarding school with little running water, Salma moved to Los Angeles for her university education. She studied at Loyola Marymount University. In 1994, she graduated with an international business degree. Subsequently, she worked for a food brokerage company in the US.
Salma Okonkwo Return to AfricaAt 33 years of age, Okonkwo, her husband, and their children returned to Ghana. Sahara Energy and Gas, an oil and gas company, offered her a position in the company. She would not stop working, even with the daunting motherhood demands. Interestingly, she was keen on attaining financial independence, believing that it was key to a successful marriage. Eventually, she became the first female senior executive at Sahara Energy and Gas where she spearheaded the Ghanaian market.
A few years later, Okonkwo spotted an exciting opportunity for the energy company. This was about building filling stations in the Northern part of Ghana, where infrastructure is scarce. Sadly, her employer refused to buy the idea. According to Salma Okonkwo, her employer was risk-averse.
The company executives claimed that the wallet size of rural customers was low and the cost of operation would not be ideal for the company. They argued that since the margins in the oil trading business were very high, diluting the same with lower margins was too unattractive. Furthermore, the business plan would be too political to change. Again, it would require too much of an investment in infrastructure.
Going It Alone
In 2006, Salma Okonkwo felt that the ‘no’s she had heard were enough. So, she decided to quit her job at the Sahara Energy and Gas company to try the idea she had conceived. Subsequently, Salma founded UBI Group. At first, the Ghanaian entrepreneur focused on bringing liquefied gas to the hard-to-reach region of Northern Ghana. Here, many families still rely on energy from burning firewood.
Since her dad hailed from the area, she had firsthand knowledge of how her business idea would change the lives of many people in the region. Salma recalls, “It was just too hard to pass up the opportunity.” However, Okonkwo had forgotten to take into account a complicating factor—there were few storage facilities for liquefied gas in the north. Therefore, she needed to build the storage facilities herself while struggling to secure funding. This challenge prompted her to change her approach.
She started wholesale trading diesel and petroleum. In 2007, Salma Okonkwo secured a contract to supply fuel to Kosmos Energy, a Dallas-based company. In 2008, she secured another contract with Hess. To finance the operation, she mortgaged some properties that her family and husband had inherited.
UBI opened its first retail gas station in 2008. With time, it owned 8 stations and managed another 20 through partnerships. That attracted Puma Energy, Singapore multinational firm. So, Puma secured a 49% stake in two subsidiaries owned by the UBI Group, and that translated to about $150 million.
Birth of Blue Power EnergyAfter the acquisition by Puma was complete in 2013, Salma started moving towards renewable energy solutions. She began to develop her solar energy—Blue Power Energy. Though there is a lot of sunshine in Africa, most energy providers are yet to make solar energy their first choice on the continent. Salma saw this as an opportunity.
In 2015, she embarked on research and development of a solar business. By 2018, she had already secured most of the regulatory requirements. She had even signed an agreement with the Ghanaian government renewable arm, BUI Power Authority. The government was to develop part of their solar portfolio as a build-operate-transfer (BOT). It also involved taking over an earmarked site, which was near Salma’s paternal ancestral home, to build a 100MW solar farm.
So far, Blue Power Energy provides solar energy to 50,000 homes in Ghana. Salma’s biggest motivation behind building this firm in Northern Ghana is to increase access to electricity in the region. She also aims to not only create employment but also uplift the standard of living for many people in that region. The company’s main focus is to employ and uplift women in deprived and disadvantaged area. Okonkwo says, “I want to bring support to my people in the north. Then, there will be more Salma’s all over the place.”
Salma Okonkwo has built Blue Power Energy in Northern Ghana, which is her paternal heritage. The company delivers inexpensive power in northern Ghana. It all began with the hunger to make a difference in her community by offering people access to electricity in the region. Today, that passion reduces poverty and unemployment through job creation. She hopes to expand throughout West Africa.
Previously, Salma decided to sell a significant stake at the UBI group to a foreign company mainly due to inadequate finances. However, she hopes Blue Power Energy will follow a different trajectory by tapping more directly into international capital markets to help it achieve its vision. We hope that Salma’s story will motivate aspiring and upcoming African entrepreneurs to create solutions to African problems. If you are thinking about investing in Ghana, hear what Salma has to say below.
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