SABBEX executive head Vanessa Davidson says the upsurge in the number of new power generation facilities in the Western Cape province augurs well for manufacturers – including boat builders – affected by skyrocketing electricity tariffs.
Davidson welcomed the news of 111 new registered power generation facilities countrywide in the first quarter of the new financial year, of which 24 are in the Western Cape where most of the big boat yards are situated.
The Province leads the way in terms of overall new installed power capacity –740.63 MW – and the associated investment cost of R21.41-billion (£900-million), according to figures released by the National Energy Regulator of South Africa (Nersa).
Solar PV had emerged as the most predominant technology in the new power generation landscape, Nersa said.
The push for new power capacity stems from South Africa’s ongoing power crisis that has seen the electricity tariff skyrocket by around 300% over the past decade, with huge cost implications for manufacturers. In addition, the economy was rattled by years of load shedding caused by a power supply shortfall that has abated over the past year – with no load shedding reported for over 100 days as of this week.
Some of the country’s largest boat yards have invested in back-up power supply to mitigate the negative impact of disrupted supply from the national grid, which is managed by state-run Eskom.
Davidson says the healthy investment in new generation is a vote of confidence in the regional economy. Additional capacity would also help drive down the electricity tariff, particularly as government moves to allow more private sector involvement in the energy market. “Electricity is one of the big input costs for boat manufacturers, and therefore increasing generation capacity can only be good news, particularly in the context of constrained supply which in the past has negatively affected the entire economy,” Davidson said.