The uMgungunglovu District has emerged as the surprise leader among SA regions battling to engineer solutions to loadshedding. The region, which includes PMB, Howick and Mooi River, is launching massive battery plants to serve business hubs. James Martin, who heads Economic Recovery in the district says the batteries will be charged by independent power producers and within a year electricity will be flowing to businesses to ensure they are unaffected during Eskom blackouts. Memories of last year’s KZN riots and the way loadshedding is hitting employment provided the stimulus to sweep aside red tape – and launch a pragmatic solution which could provide a template for other parts of the country. Martin spoke to Alec Hogg of BizNews.
Find Timestamps of the Interview Below:
- James Martin on the consequences of the looting and riots in the KZN economy – 00:02:11
- On managing loadshedding in his district and the consequences thereof – 00:04:51
- On using battery packs – 00:13:06
- On the cost of battery packs – 00:15:44
- On hydroelectric power – 00:20:57
James Martin on the consequences of the looting and riots in the KZN economy
Some of the sectors are actually. Tourism is back to where it was. And we’re grateful for the fact that there’s been a shift in the tourists. So it’s local tourists now. The bed numbers are sort of up to where they were pre-COVID. And now we’re waiting for the foreigners to arrive, which should then tip the numbers over the pre-COVID level. Agriculture has always been doing well with the good rains that we have and people need to eat. So that’s survived well. And interesting things like the hardware stores where people are building informally – there’s so much informal building taking place. Those kinds of retail guys are showing really strong results in the retail side. The guys that are taking strain, obviously, it’s the load shedding and the various other consequences, are really battling to survive. We are almost back, I would say to pre-COVID days, there’s still a couple of shops in town that haven’t recovered and they’re still empty. And people had to reinvent themselves. But I think on the whole, we’re on track as a business community – back to where we should be.
On managing loadshedding in his district and the consequences thereof
To set the scene, and I don’t want to labour the issue, the consequences from the agricultural sector – from our dairy farmers to the local bakeries, everybody. Every single business is affected by loadshedding, however you look at it. So just to contextualise, I’m with the Economic Development Agency. After the rioting we set up a unit called Economic Recovery. And the idea of that is it’s an economic rip-cord to try and fast track anything that’s going to get the economy back on track and to get the jobs back, to keep our investors and to attract new investors. And I head up the economic recovery side of that. So I carry with me a mandate of government as the agency. If I could just explain the district municipality in this case is a water supplier. That’s its mandate – district municipalities can provide water, bulk infrastructure, things like fire engines and wastewater, etc.. so that’s our function. The municipality then, through a council resolution, mandated that the agency for which I’m working, which is completely owned by the district municipality as a state owned enterprise, be tasked at looking at creative energy solutions, whether it’s the wheeling or the generation of energy. So my discussion with you today is as much about Eskom and energy as it is around the economy. Our biggest threat to job loss in this district is energy right now. It’s without a doubt at the top of everybody’s mind. It’s on the lips of all our big businesses who are taking real strain. To add – in this district of a million people, one third of the people don’t have three meals a day. 60% of our population is under the age of 24 and 64% of them (of working age) are unemployed. So we’re sitting in a precarious socio-economic situation. It’s not business as usual. And I think that’s the message that we’ve taken to whoever we’ve spoken to about what I’m about to tell you in terms of the way we see this going forward. Melanie and the Chamber are on board, are colleagues from NAFCOF on board. I have spoken to Eskom, various role players, so we’re not speaking in a vacuum here and we have the blessing of our political leadership to be driving what we are driving right now. So if we were to look at loadshedding and the consequences thereof from an economic perspective, which is where my area of responsibility lies, it’s on the jobs, it’s on the investors, it’s on the business community. And we’re feeling their pain. We’re feeling the fact that they stand up and they say they’re wanting to disinvest. We are on the brink of launching a new city at Camperdown, 400 hectares. We have major investors potentially coming into that whole new midrand, if I can call it that between Maritzburg and Durban, that is potentially the province’s biggest growth area and we feel we can’t attract them without offering them at least a reliable energy supply. So we’re taking out the sniper rifle and we are focusing energy on the business community.
On using battery packs
My guys are saying within a year we could be operational – which is what we’re aiming for. So obviously it’s Christmas, which is giving us a six week breather unfortunately. But in the middle of January we’ll be convening with Eskom, with the Chambers, with NAFCOC. We have a close working relationship with a very strong team from the Richards Bay IDZ who are driving the gasification side of things and they’re fully equipped with engineers and the resources that we might not have. And from the third week of January, it’s all systems go. Because I’ve been through a supply chain process of advertising and anybody from across the country has been able to tender, we now have a legitimate supply chain process. We have liberty to proceed with the people who’ve submitted. We’re putting them into a basket, into one team. Some of them are international, some are very local. Some of them want to set up small solar farms and tribal communities, which is a great initiative if the numbers work. So it’s a pretty diverse and really potentially transformative approach that would package these guys into one directed battery pack per job-sustaining node, as it were. At Eskom, the people I’ve spoken to have said, please, if you can ease the burden, we’ve run out of money, we can’t raise any more generation funding. We are generated to the max. Whatever we can do to raise money to generate more energy, please find ways to do it. And this way you sort of bypass a lot of the red tape, a lot of the impediments that might otherwise have stopped this process. But for us, loadshedding for our job creating business is the core of our economy that is most at risk of ripping the guts out of our society. And as the agency, that’s our sniper rifle focus for the next year, amongst other things.
On the cost of battery packs
Those numbers are still to be through the wash but if you consider that Eskom is planning double digit increases for the next five years, that’s a 50% increase over the next short term. We believe that the renewables that are coming in and certainly the gas that’s coming in is going to be significantly cheaper. That will afford us the spare change with which we can use to procure the energy storage, the battery packs. And I think that even if the businesses are paying the same and we are transparent in our costing to say that the savings you would have made is going towards the battery pack, they would be willing for the sake of continuity of energy supply.
On hydroelectric power
One of our IPP’s made that very submission for exactly the schemes that you’ve been talking about. So we now have an opportunity to engage with them on those potentials. There is a defunct hydro-plant at Howick Falls. The Spring Grove Dam, for example, releases huge amounts of water. And then the drop between Midmar dam and the other dam, Albert Falls, is probably 300 to 400 metres. So those opportunities are what we’re going to be focussing on to a large extent now going forward. So Chris is right, he can do it on his side or we can collaborate. Obviously as the district municipality, we won’t interfere, we will facilitate the process, but we’re not in the value chain. So if Hydro within uMngeni, we will link them up with Chris and his team. Our job is to facilitate that process. So at least this way around we can look at it from a district perspective and we’ve been through a supply chain process that will enable us to start basically in January or February.
Read also:
- From the archives: A national blackout is only a loadshedding moment away – Ted Blom
- Firing obstructive communist Mantashe will be big step to addressing loadshedding – and may happen soon
- Dark days ahead as Eskom paints best/worst case loadshedding scenarios
