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South Africa: Trade & Industry Department to facilitate renewables

The trade and industry department is working on a plan to increase local capacity to produce alternative energy products in a bid to help ease Eskom's strained supply system.
It is also revising SA's industrial policy framework generally, to assess the effect of limited power on energy-intensive sectors earmarked for development.

The chief director of industrial policy, Nimrod Zalk, said yesterday the department was studying the effect of the energy crisis on its industrial policy. But it was looking at a combination of the "threats, as well as opportunities the situation presents, " he said.

The opportunity to massively and rapidly increase capacities to manufacture products such as solar-panel heaters, compact fluorescent light bulbs and other energy-saving devices, in SA and the rest of the Southern African Customs Union (Sacu) region, is being explored.

Under the industrial policy, sectors manufacturing these products would probably become eligible for financial incentives to stimulate investment.

Eskom has indicated that it wants to roll out as many as 200000 solar heaters a year over the next five years, to divert a significant source of demand to alternative energy sources. But the Sacu region is unable to produce more than 10000 units a year.

The industrial strategy, crafted to boost growth and jobs, was released in August last year. However, the power constraints have thrown a spanner in the works .

The developmental electricity pricing programme was one of the department's key incentives to attract large industrial investments. It was developed in consultation with Eskom and the public enterprises department as a sweetener for industrial investment in SA through cheaper electricity tariffs, but the plan has been called into question.

The possible suspension of the programme has not been raised yet by Eskom, but Zalk said the situation meant the department had to look "much more carefully at what kind of investment we seek to attract. The days for promoting SA as a destination of surplus and cheap electricity are over. But that does not mean industrial investment will not take place."

Additional information: More at AllAfrica
News date: 05/02/2008

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