South Africans are set to pay more for power, as the National Energy Regulator of South Africa (Nersa) has given Eskom the green light to increasing its tariff by over 15% for the 2021/22 financial year.
The Automotive Industry Development Centre in the Eastern Cape (AIDCEC) said an electricity tariff increase of 15% would impede the South African automotive supply chain’s drive for greater levels of global attractiveness.
According to the AIDCEC, mounting input costs could curb growth in volumes and particularly in exports, resulting in the difficulty for the automotive sector to achieve targets for the country relating to inclusiveness, localisation, and job creation.
Thabo Shenxane, CEO of AIDCEC, said the tariff increase would negatively affect the Eastern Cape economy, which is driven by automotive manufacturing. “As South Africa’s leading producer of vehicles and its biggest exporter, accounting for around 49% of SA’s vehicle exports, the Eastern Cape and by extension South Africa’s supply chain will be under even greater pressure to produce at competitive prices,” Shenxane expressed.
“Not too long ago, the cost-effective and stable electricity input was a competitive advantage of South Africa’s automotive value proposition. This is no longer the case, and the sector cannot keep absorbing such increases. The losers, in this case, will be regions that dominate autos production such as the Eastern Cape,” said Renai Moothilal, executive director of the National Association of Automotive and Allied Manufacturers (Naacam), who saw the Eastern Cape automotive manufacturing sector as a vital cog in the overall South African automotive sector.
The AIDCEC has stated that according to its experience, generally electricity costs are between 5 and 10% of total operating expenses for medium to large auto manufacturers and up to 20% for smaller companies and that the automotive sector, the metal, glass, and rubber processing facilities will be impacted the most as they take on higher energy-consuming processes.
The AIDCEC reported that around 13% of the automotive firms that supply directly to OEMs fall into this category in the Eastern Cape.
According to Elmar Thiart, AIDCEC’s energy management project manager, industries or companies known for high energy consumption will have to continue evaluating alternative energy sources or alternative methods to assist in creating the same product, to ensure long term sustainability.
In addition to the issue of pricing, Shenxane believes that to ensure a stable power supply network, Eskom should be allowed by the government to work alongside independent power producers to help with energy supplementation where Eskom fails to meet demand.
“As we lobby and position the Eastern Cape for greater manufacturing-related investment, the issue of a stable power supply and reasonable tariffs is key,” Shenxane stated.
Shenxane said the AIDCEC was playing an active role in assisting companies with energy management issues.
Logistics Going Green
A logistics start-up has launched eco-friendly packaging that allows online retailers to minimize their impact on the environment with last-mile deliveries. The new packaging will offer the same quality, durability, and security everyone has come to expect with an added benefit of leaving minimal impact on the environment.
In South Africa alone, billions of plastic bags are discarded every year. Clinging to trees, spreading across fences, and filling up gutters. Sadly, the logistics industry also contributes to this single-use plastic wastefulness.
Many single-use plastic items are only used for a few minutes and outlive their users for hundreds of years. Being industry disruptors within the logistics field, the logistics start-up has the privilege to address this pressing concern and pilot their new sustainable paper packaging range, which includes mailing bags, envelopes and packaging tape ensuring tough tamperproof and trusted products.
There is no denying it anymore, single-use plastic is not sustainable. By adding this paper packaging option to last-mile delivery every fulfilment strategy can be environmentally sustainable and change the logistics industry altogether.
Abu Qir Port Project Contract Awarded to DEME
DEME, the dredging, offshore, environmental, and infrastructure service specialists, announced that at the end of last year it secured a large dredging contract for the Abu Qir port project in Egypt.
Described as the largest ever dredging and land reclamation contract in history, the project includes the reclamation of 1 000ha of new land, the deepening of the port’s approach channel to 23m and the dredging of a turning basin to 22m. More than 150-million cubic metres will be dredged.
This ambitious megaproject creates land for the expansion and further development of Abu Qir, which boasts an ancient history and is slated to become a bustling economic hub, supplementing nearby Alexandria, in Egypt.
DEME will deploy the world’s most powerful CSD (Cutter Suction Dredger) ‘Spartacus’ on the project.
The project’s preparation has already started, with the main works set to commence in early 2021. The project is set for completion in 2023.
“We are very proud to have secured our largest ever dredging and land reclamation contract to date, and to support the Arab Republic of Egypt in its ambitions to develop a world-class project,” says DEME CEO Luc Vandenbulcke.
Convergence Partners acquire CTrack
Technology investor Convergence Partners has entered into an agreement with Inseego to acquire 100% of Ctrack’s operations in Africa and the Middle East.
The transaction will be the maiden investment for its third fund, the Convergence Partners Digital Infrastructure Fund (CPDIF).
Ctrack is a telematics software-as-a-service digital infrastructure platform, providing fleet management, insurance and weather telematics solutions, as well as asset tracking products, to its subscribers in Africa and the Middle East.
Convergence Partners says the business’s Internet-of-Things (IoT) and data analytics capabilities are a key component of an emerging sector in Africa and the company is a good fit with CPDIF’s strategy of identifying high-growth market players that build digital infrastructure on the continent.