Shantan Reddy, Deputy Chairman of the Edison Power Group, shares his thoughts on the current energy crisis in South Africa.
1. What are South Africa’s setbacks in terms of its power challenges at the moment?
The lag between rapidly growing our capacity required versus supply of required capacity.
2. How are the power challenges we face at the moment hampering business? In your opinion, how bad is load‐shedding really for business?
The short term effect for small to medium business are causing damage, however, not as severe as what the long term effects of load shedding will be on the current electricity infrastructure due to continual surges introduced each time the network gets re-energized. Hence, due to lead time associated with replacement of key infrastructure elements, it might have an even bigger impact on ALL industries across SA in the long term.
3. How is South Africa’s electricity crisis threatening business continuity?
At this point if the current timelines regarding new increased supply is adhered to, business will experience a dip, but not an abrupt discontinuation. Also, the South African business needs to adapt to current state, as various measures are being made available to counter the effect of load-shedding.
4. Which sectors are hit the hardest?
Retail and manufacturing sectors are most probably suffering most due high dependency on walk-in profile customer.
5. How vital is the move toward renewable energy solutions at the moment; how can it help alleviate the crises and therefore benefit business and the economy – and therefore also help avoid load-shedding?
At this point in time renewable energy is a bit farfetched as a mass deployable and cost effective commercial solution due to the fact that from regulatory through to agreed pricing structures are still not finalised and officially approved.
6. How much investment potential is there in South Africa’s renewable energy sector, and how much are we already seeing?
The potential for investment is a definite reality, however the question becomes proximity of realisation of return on this investment.
7. Why is it important to make power cost effective and how can this be achieved ‐ particularly for our local business community?
The selling of power is the lifeline for utilities, hence preventing customers from moving towards alternative energy solutions, which has the potential of crippling the utility business model, should be deemed as a business critical initiative.
8. What can be done from both a public and private sector point of view to deal with load shedding more effectively?
They can allow the utility to engage them in more innovative load management initiatives.
9. Tell us about some of your renewable energy projects that are happening at the moment.
We are involved in various renewable energy projects from fulfilling the role of EPC contractor to various levels of involvement. E.g. IPP Licence holder to EPC level of execution.
10. The IPP project seems to be quite big; tell us more about photovoltaic technology?
At this point in time the viability and sustainability of these projects are yet to be proven within the current African context.
11. What is the importance of proper training in the power industry, does this add to the power crisis at all?
It is of imperative importance to ensure both resourcing and supporting policies get addressed as part of the route towards sustainable electricity supply and utilisation within the industry.
12. If you could talk directly to government, would you have any advice regarding South Africa’s power and energy issues?
I believe our current power crisis is due to various elements linked to the legacy of the Apartheid era and not necessarily caused by the current government. However, I believe due to pragmatic measures taken by the current government it will be resolved within the next five years. Hence, my advice will be to stay focussed on the current well thought through and formulated mitigation plans in action at current.
13. How can Eskom fix the problem?
Eskom should shift their core focus on becoming mainly a generator of electricity and allowing a controlled measure of privatisation within the generation space as well. Lastly, it should assist the current municipalities to become proficient as transmission and distribution agents.
EPG is a returning platinum sponsor at African Utility Week and was interviewed by Black Business Quarterly.