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A judgment handed down by the Makhanda High Court on Friday [October 7] found that Transport Minister Fikile Mbalula and his Eastern Cape counterpart have failed to fulfil their legal obligation with regards to stopping the attacks on long-distance coach company Intercape.

Intercape turned to the courts after it “repeatedly requested” government to intervene and stop the ongoing attacks on the bus service by taxi associations.

The company reports that it has been the victim of widespread and ongoing acts of violence and intimidation since 2015.

During this time, it has lodged more than 150 criminal cases with the police, with more than 70 of those in the Eastern Cape.

Judge John Smith has ordered Mbalula and Transport and Safety MEC Xolile Nqatha to liaise with the South African Police Service to formulate an action plan “to ensure that reasonable and effective measures are put in place to provide for the safety and security of long-distance bus drivers and passengers in the Eastern Cape”.

Smith ordered that the action plan must be delivered within 20 days – October 28.

He also slammed the Mbalula and the office of the MEC for having “persistently and unjustifiably breached their legal duties to intervene in the current crisis” facing Intercape.

“I am of the view that the evidence clearly establishes that [former] MEC Weziwe Tikana-Gxothiwe has failed to intervene in the current crisis in any meaningful way. Insofar as the Minister is concerned, the sum total of his contended intervention was to attend a single meeting in the Eastern Cape.

“[The parties] have consistently failed to respond to various requests for intervention from Intercape,” Smith found.

“And it is manifest that nothing will happen if they are not compelled to comply with their constitutional and statutory obligations under court supervision.”

In addition to the order for the Minister and new MEC Nqatha – appointed in August – to come up with an action plan within 20 days, Judge Smith also awarded costs in Intercape’s favour.

Commenting on the judgment, Intercape CEO Johann Ferreira says it is a “shocking indictment” on both Mbalula and Tikana-Gxothiwe.

“Minister Mbalula has shown no political or administrative will to intervene in the critical public transport sector which resides under him,” notes Ferreira.

“He never took any of the issues we raised seriously and this amounts to gross negligence and an abdication of his constitutional responsibilities.

“That it has taken an order of court to compel him and the provincial minister to take responsibility for their portfolios is outrageous.”

Deliberate Strategy

Smith also found that “the violence (directed at Intercape) is not random, but part of a deliberate strategy on the part of certain taxi associations.

“The violence is aimed at intimidating and coercing Intercape into agreeing to the unlawful demands of those taxi associations, which, among others, are that Intercape must [increase] its prices and [reduce] the number of buses operating on different routes and must pay levies to operate in certain areas.

“Intercape's dogged refusal to agree to those unlawful demands were met with further acts of violence directed at their buses, drivers and passengers.

“One of these incidents led to a fatality, and the instigators of the violence have succeeded in establishing no-go zones, making it impossible for Intercape to operate in certain areas,” noted Smith.

The judge also found that Tikana-Gxothiwe had “acted unlawfully” when she directed Intercape to enter into negotiations with the minibus taxi industry, and to suspend its services in certain towns in the Eastern Cape, pending the outcome of these negotiations.

“That we could be instructed by an officer of the State to do something that was patently illegal to benefit a criminal enterprise is an outrage,” says Ferreira.

“Our lawyers told the MEC so at the time – this was a complete dereliction of duty by an elected office bearer who took an oath of office t...

The strike by employees at Transnet’s port and rail operations is going to cost the economy billions of rands and will likely set back the country’s efforts to drive a recovery, says business organisation Business Leadership South Africa (BLSA) CEO Busi Mavuso.

Some Transnet employees have downed tools in a dispute over wage increases.

Mavuso describes the strike as an act of economic sabotage that will damage government revenue, robbing it of the resources needed to provide poverty relief.

Industry body the Steel and Engineering Industries Federation of Southern Africa (Seifsa) states that the South African economy is already on its knees.

"Our economy is under siege as it battles a jobs, growth and hunger crisis. A devastating 63.9% of South Africans under the age of 24 are unemployed, consumer inflation is at a 13-year high and one-in-four people live below the food poverty line.

"A full-blown strike at Transnet will add to the damage suffered by the South African economy. This will be as bad as load-shedding in terms of economic impact. For an economy battling to maintain momentum, this could well be the final nail in the coffin," Seifsa CEO Lucio Trentini says.

The strike has forced Transnet to suspend all activity in its ports, snarling up imports and exports for the whole country. Miners and many other companies are losing billions while this goes on, with early estimates putting the costs at R6-billion a day, Mavuso states.

The unions have said the strike is indefinite and 15 000 workers are not going to be working today. All ports and freight rail are not expected to operate, she adds.

"This is disastrous not only to obvious sectors linked to direct imports like the medical sector, and exports, like the mining sector, but to the entire, interconnected economy. It further damages South Africa’s brand, with global cargo operators likely already moving on to other ports and further deprioritising South Africa. This is very bad news indeed," Mavuso asserts.

"The decision by United National Transport Union (Untu) and the South African Transport and Allied Workers' Union (Satawu), to go on strike last week, in the middle of negotiations that were ongoing at the Commission for Conciliation, Mediation and Arbitration (CCMA), is another severe blow to the economy.

“The strike is, at the very least, an act of bad faith, given that negotiations were under way at the time and several court cases are testing its legality. It caught both Transnet and government off guard," she adds.

Seifsa has appealed for a constructive approach that seeks to advance the interests of the country.

"Transnet, as with Eskom, is crucial to the country’s economy. Transnet’s rail and port facilities are key to exporting the country’s bulk commodity exports such as coal, iron-ore, chrome and manganese. A full-blown strike at Transnet, which seems unavoidable, will have a serious effect on the economy, as it will halt exports and put thousands of jobs on the line," Trentini notes.

Exporters rely heavily on efficient rail networks and ports, but Transnet has been operating below capacity for years as it grapples with a shortage of locomotives, cable theft, vandalism, poor maintenance and outdated and slow port infrastructure. This substandard service has had a significant impact on the local steel industry and its ability to manufacture steel to meet its customers’ demands.

In some instances, primary steel producers have had to shut down operating plants due to the unavailability of raw materials, at great cost to their businesses and the economy, states Seifsa.

"We know that it will not be easy to make compromises, but we appeal nevertheless for a win-win approach to the negotiations, as opposed to a winner-takes-all approach. Our plea to all the negotiators, and to those from whom they obtain their mandates, is that you rise above your narrow interests and put the interests of the South African economy first, and look to settle quickly," Trentini says...

The Atterbury group and Truworths have inked a deal for the creation of a new distribution centre in Cape Town.

The clothing retailer’s new facility will be built in King Air Industria, which is an Atterbury Property and Old Mutual Properties development.

Truworths will lease the new building, which will consolidate all of its various Cape Town facilities under one roof.

The development’s 53 000 m2 initial phase consists of a 3 000 m2 office and 50 000 m2 warehouse, and includes the option to expand to 70 000 m2.

Designed to target an internationally recognised EDGE sustainability certification, the development will break ground this month, with the building scheduled for completion in September, next year.

“As a result of business growth we have spent some time looking to build a larger, state-of-the-art distribution centre to accommodate our future requirements,” says Truworths CFO Emanuel Cristaudo.

“This positions us well for the future and we are looking forward to the completion of this project.”

The value of the development is not disclosed.

Atterbury’s King Air Industria development manager Arno du Plessis adds that the development roll-out of King Air Industria is making “excellent progress and attracting a high calibre of businesses that want to be near the airport, but also seek quality, efficient premises that support both their business and sustainability goals”.

King Air Industria is located between Airport Approach, Borcherds Quarry, Robert Sobukwe and Pallotti roads, and connected to the city and inland region with access to the N2 and R300 freeways.

The 72 ha development is already home to The Courier Guy, operating in a 10 112 m2 facility, and Morgan Cargo, operating in a 7 500 m2 provincial head office building that includes a specialised cold storage facility.

“We are enjoying great leasing momentum in the Western Cape, not only at King Air Industria, but also at other properties, including Richmond Park, where the demand-driven development roll-out is proceeding at an exciting pace,” says Atterbury leasing manager Mia Kitshoff.

Atterbury has signed a deal with online retailer Takealot for a 20 400 m2 second phase of its Richmond Park distribution facility, which will take the total size to 44 000 m2 when it is completed in June next year.

The property group has also signed hardware retailer Brights for a 6 000 m2 facility, which will be completed in November next year.

The Shoprite group says it has increased its installed capacity of solar photovoltaic (PV) systems by 82%, to 26 606 kWp, over the past 12 months.

The 143 674 m2 of solar panels at 62 sites is equivalent to the size of 20 soccer fields.

This is sufficient to power the equivalent of 3 735 households for a year, thus easing the pressure on the national electricity grid, notes the retailer.

Shoprite says it is focused on further expanding its solar-powered and renewable electricity installations, while also improving energy efficiency to reduce its environmental footprint.

Initiatives here include a drive to reduce electricity consumption by installing LED lights at all of the group’s sites, which has saved 399-million kWh to date.

In the last financial year, Shoprite has increased its total renewable installations from 32 to 62.

These installations currently produce 40 894 MWh – 11 614 MWh more than in November last year.

At the same time, the group has increased its fleet of solar-powered trailers by 234, to a total of 1 041 trailers.

“We are incredibly proud of our increased use of renewable electricity, and we intend to build on this in the coming years to meet our science-based emission reduction targets, including net-zero greenhouse gas emissions by 2050,” says Shoprite group sustainability manager Sanjeev Raghubir.

“Furthermore, we’ve saved more than R16-million in electricity costs in the past year through our solar PV systems, and these additional savings are passed on to our customers.”

Engineering News Editor Terence Creamer talks about the closing of bidding for Bid Window 6 (BW 6) of the Renewable Energy Independent Power Producers Procurement Programme; the response to the BW 6 tender; what the outcome of this round is likely to be; the ongoing difficulties in getting energy procurement going again; and what impact this is likely to have on South Africa's energy crisis.

Sun International has broken ground on its latest development: the R295-million expansion of its Sun Vacation Club (SVC) – one of South Africa’s leading timeshare models – at the group’s iconic Sun City resort, in the North West.

The group’s first significant expansion at the resort since the development of the Aviary in 2004, the Lefika Villas comprises 58 luxury villas – 48 three-bedroom villas and 10 four-bedroom villas – as well as a recreational area with a resort pool, family restaurant and kid’s play area.

“We are experiencing significant demand for SVC accommodation at Sun City and this expansion will help satisfy this demand. We are confident that this development will achieve above market returns,” Sun International CEO Anthony Leeming told media during the sod-turning event this week.

The development forms part of Sun International’s multimillion-rand masterplan that includes the potential development of another 200 two-bedroom units. This will be fully dependent on the success of Lefika Villas and driven by demand.

The addition of Lefika Villas, which will be able to accommodate up to 400 additional guests, will increase the SVC at Sun City to 478 units once it is completed by November 2023.

“Sun City remains perennially popular and post-Covid, we have seen an increase in demand from leisure, conference and sporting guests. We have invested significantly in the property and the Resort is in great condition. We are also seeing great demand for self-catering units at the Sun Vacation Club,” Leeming continues.

“The Lefika Villas were born from the market demand for a high-end luxury, self-catering product at Sun City Resort. The SVC Lion suites and the three-bedroom units sold out in record time, highlighting the appetite for more space and more luxury,” explains SVC Group GM Janita Donaldson.

As part of the development, there will be significant inclusion of surrounding communities in upliftment and knowledge and skills transfer projects, with a stipulated 30% build value to be allocated to local contractors, Sun City Resort GM Brett Hoppe adds.

According to the development team, the design of Lefika Villas, which means “stone” in the local Setswana language, draws inspiration from the adjacent stone-walled Itlholanoga heritage site.

The settlement, located on the northern face of the hill overlooking the entire valley, is rated as a level five for historic significance and is a designated provincial heritage site.

Sun International enlisted the assistance of leading archaeological and heritage experts, including University of the Witwatersrand archaeology professor and Origins Centre director Mandy Esterhuyzen, who will assist with the management and preservation of this and surrounding historical heritage sites.

The villas are also designed with as little intrusion of the surrounding natural landscape as possible, with all the units arranged to accommodate existing natural features, typography and views.

“Special attention was also given to the preservation of existing natural features on site. The new villas have been located around existing natural topographies such as existing rock outcrops and existing trees as far as possible. The serene bush setting feels miles away from the heart of the bustling Sun City Resort which is literally two minutes away,” says Sun International development manager Mark Pitchers.

Meanwhile, Sun International is continuing with several current upgrade projects at Sun City, which is home to the iconic 327-room The Palace of The Lost City Hotel, the 241-room five-star Cascades hotel, the 380-room Cabanas and the Bush Bungalows with 14 chalets, as well as the 340-room four-star Sun City hotel.

The group embarked on a complete R208-million refurbishment of the The Palace of The Lost City, including the installation of a Spa and gym, which will be completed in November when the hotel celebrates its thirtieth birthday.

The exclusive Salon Privé in the Sun City Hotel has also been given ...

The shortage of electricity in many African countries is about equivalent to 1% of the global average and if this energy poverty gap is to be bridged by renewable energy in line with carbon-neutral targets, Africa will need to deploy an additional 2 354 GW of renewable generation by 2050 to bring the continent up to the world average for electricity access and meet decarbonisation commitments, professional services firm PwC estimates.

This increase of nearly 40 times the current installed renewables capacity of 59 GW is estimated to cost Africa about $2.6-trillion – about the current size of Africa’s gross domestic product.

Exacerbating this is a rapidly changing global landscape, including climate change policy pressures, geopolitical tensions such as the Ukraine conflict, societal changes triggered by the Covid-19 pandemic and a greater awareness of planetary boundaries and social justice, PwC highlights.

However, it says Africa still has great energy potential, both in fossil fuel and renewable energy resources.

“The continent needs to optimise value from its fossil fuel endowments through a just transition to support the sustainable development of a green energy base. The potential for increased investment and foreign earnings from the export of fossil fuels, especially natural gas, is evident.

“Africa also has high-quality renewable resources across solar, wind, geothermal and hydro. Despite the quality of renewable resources, Africa has less than 1% of global installed solar photovoltaic (PV) capacity as an example,” PwC points out.

“Addressing energy poverty and transitioning to green energy will be unaffordable to Africa if it is left to self-fund and forced to forfeit its fossil fuel endowment — or to phase down its fossil fuel sectors under global policy and market pressure.

“The developed world needs to support Africa’s energy growth as part of its just transition commitment. Although it has made significant commitments to climate reparations for Africa, the speed and scale of execution remains insufficient,” PwC Africa Energy, Utilities and Resources leader Andries Rossouw emphasises.

He says that, to turn the tide on the continent’s energy poverty and achieve a sustainable energy transition, a significant increase in energy sector investment is required.

More than 59 GW of installed capacity is present in Africa (based on the 2021 baseline). Hydropower and pumped storage, together, account for 63.8% of the continent’s installed capacity and provide most of the continent's renewable energy.

Solar and wind installed capacity makes up 19.3% and 12.4%, respectively. The remaining 4.5% of the installed capacity is made up of various other renewable energy sources, including geothermal, biofuels and others.

However, renewable energy growth in Africa has slowed over the past five years, with lower growth attributed to disruptions in construction owing to Covid-19 and delays to South Africa's large-scale Renewable Energy Independent Power Producer Procurement Programme.

UNSERVED ENERGY COST

Many African countries are grappling with power shortages despite having a wealth of energy generation resources. PwC’s ‘Africa Energy Review’ outlines the cost of unserved energy (CoUE).

For example, in South Africa, the State-owned power utility shed 2 276 GWh of power in the first half of the year, to maintain a stable power grid. PwC estimates this CoUE at between $2.54/kWh and $2.88/kWh.

When these values are applied to the actual load-shedding that was implemented during 2021, the loss of real gross domestic product growth was between 2.4 and 2.9 percentage points — which would have equated to an additional 290 000 to 350 000 potential jobs being created.

This highlights that reliable and affordable access to electricity is the single biggest economic growth and job creation lever for Africa’s most industrialised economy, which is likely to hold true for other economies on the continent, PwC points out.

Leading South African mineral sands producer Richards Bay Minerals (RBM) has entered into a 20-year power purchase agreement (PPA) with independent power producer Voltalia for the supply of wheeled renewable energy from a 148 MW solar photovoltaic (PV) facility in Limpopo to its smelting and processing facilities in KwaZulu-Natal.

Voltalia and its black economic empowerment partners, the identities of whom have not yet been disclosed, will begin construction of the Bolobedu solar project in 2023 at a site that is about 120 km east of Polokwane.

The project value has also not yet been disclosed, but Voltalia CEO Sébastien Clerc reports that South African banks have shown a strong appetite for funding the project.

“These banks of course will provide funding in South African rand, which is essential since the cash flows of the power plants are in the same currency with very long-term debt.”

Once completed in 2024, the facility will be able to deliver 300 GWh yearly into the national grid and supply electricity to RBM through a 130 MW wheeling agreement in line with recent reforms to South Africa’s Electricity Regulation Act.

MARKET REFORMS

The reform allows embedded generation plants, including those wheeling electricity over Eskom and municipal networks, to proceed without a licence and to, instead, register such plants with the regulator.

In 2021, the licence-exemption threshold was raised from 1 MW to 100 MW, but President Cyril Ramaphosa announced the full lifting of that limitation on July 25 when unveiling a range of interventions aimed at tackling intensifying load-shedding.

Several mining companies have either announced or are pursuing similar opportunities, with the Minerals Council South Africa having reported that 29 of its members have 89 projects with a combined capacity of 6 500 MW and an investment value of more than R100-billion at various stages of development.

Earlier this year, another mineral sands producer, Tronox, announced that it had entered into a PPA with the SOLA Group, which would build 200 MW of solar PV capacity in the North West for wheeling to its mines and smelters in South Africa.

RBM, which is owned by Rio Tinto (74%) and a consortium of empowerment and community investors known as Blue Horizon (24%), reports that the solar electricity to be supplied will cut its yearly scope 1 and 2 greenhouse-gas emissions by at least 10%, or 237 000 t/y.

“This agreement is a first step towards reducing RBM’s carbon emissions through the use of renewable solar power, so that we contribute to a net-zero future,” RBM MD Werner Duvenhage says.

ELECTRICITY CURTAILMENT

He reports that it will also improve security of supply in a context where Eskom, which has ramped up load-shedding this year on the back of major breakdowns across its coal fleet, was currently curtailing RBM’s consumption to 215 MW.

At full capacity and when RBM runs all four of its furnaces, the company has an overall power demand equivalent to about 400 MW.

It is currently operating only three furnaces, with the fourth closed during disruptions associated with the July riots in KwaZulu-Natal in 2021, and is managing within the 215-MW restrictions by operating these at a lower power rating.

Rio Tinto also suspended the proposed $463-million Zulti South expansion at RBM, owing to security concerns including the murder of GM Nico Swart, who was shot on his way to work in 2021.

Duvenhage reports that the tariffs secured from the Bolobedu plant will be lower than Eskom tariffs, even after Eskom’s wheeling costs are included.

RBM is, thus, considering further renewables opportunities both to meet the decarbonisation commitments of its parent Rio Tinto, which aims to cut its emissions by 50% by 2030, as well as to lower the cost of its power bill.

Voltalia’s Clerc said the company was pleased to support RBM in its decarbonisation journey and noted that the Bolobedu plant would be Voltalia’s biggest and its first in South Africa, where it has a signif...

Eskom data has confirmed that South Africans endured their worst-ever month of load-shedding in September 2022, with a total of 1 503 GWh estimated to have been shed and with 572 hours of the month’s 720 hours directly affected.

Analysis by Eskom Research, Testing and Development’s Dr Ulrich Minnaar also shows that, besides 2021, there were more power cuts in September than had been experienced in any other entire year since load-shedding started in 2007.

For the year to October 5, an estimated 4 115 GWh has been load-shed, which is materially worse than the 1 776 GWh shed in 2021, which previously held the unhappy distinction of being South Africa’s most intensive load-shedding year.

The country’s next worst month was July 2022, when 397 hours were affected by rotational power cuts and 938 GWh was shed.

“This period has been unique not only for the duration of load-shedding but also the intensity of load-shedding.

“We have had load-shedding at higher levels (Stage 4 and up) for extended periods,” Minnaar explains.

The period from September 6 to October 6 was also the first time that Eskom had implemented load-shedding continuously for 30 days, and with cuts having been confirmed until at least Saturday October 8, that unfortunate record will be broken too.

Minnaar tells Engineering News that there were stretches during May and June/July this year of up to 20 consecutive days, but never for more than 30 consecutive days.

Therefore, he anticipates that the economic data for the third quarter, covering July to September, will be significantly impacted by load-shedding when compared with the previous quarter, during which power cuts were less intensive.

“The major lesson is that the performance of a significant portion of the coal fleet can be quite unpredictable [and] the addition of new generation is a critical component for eliminating load-shedding.

“It is, however, not the only component: reliability maintenance and Eskom having access to the required funds to do it properly is a key element to the reliability of the grid going forward.”

Government has announced several interventions to tackle the worsening load-shedding, but has warned that some of these will take time to have an impact.

“With the President’s establishment of a National Energy Crisis Committee we are likely to see more changes and an even greater focus on addressing the load-shedding,” Minnaar says.

JSE-listed Aveng has entered into an agreement to sell Trident Steel as a going concern for R700-million, following what it acknowledges to have been a “protracted and difficult” disposal process that was first initiated in 2017.

The buyer is Trident Steel Africa (TSA), a company specifically formed for the acquisition, and which is funded by a consortium of local and US private capital, including Ambassador Enterprises, of the US, Joseph Investments, Arbor Capital Investments and Trident Steel’s management.

“The disposal of Trident Steel has been protracted and difficult, however the board and management are satisfied that this transaction represents the best value for Aveng and shareholders,” Aveng CEO Sean Flanagan said in a statement.

The proceeds generated from the transaction will be used to settle Aveng’s remaining R406-million South African debt.

The group had external debt of R3-billion when the turnaround strategy was first initiated in 2017; a strategy that involved noncore disposals with a combined value of R1.1-billion.

Flanagan expressed confidence that the business, which supplied steel products primarily to the South African automotive, rail and mining industries, was being sold to a “credible consortium” that could continue Trident’s growth trajectory and secure the future of its employees.

The purchase price of R700-million, plus an amount of R264-million which represented the cash portion from the business, as well as a monthly ‘ticking fee’ of R7.45-million, will be payable by TSA on or before the transaction’s closing date – the first day of the calendar month following the date on which the remaining conditions precedent, including competition authority approval, were fulfilled or waived.

Aveng would provide R210-million of funding to a separate company in order to subscribe for 30% of TSA equity, which will be warehoused for the earlier of either a year from the closing date or the finalisation of an empowerment deal.

Once the Trident disposal is concluded, Aveng will have two remaining core businesses: McConnell Dowell, which operates in Australasia and South East Asia, and Moolmans, which has contract mining activities in southern, central and west Africa.

Aveng is also considering a foreign listing given that a significant portion of the combined revenue of McConnell Dowell and Moolmans is derived from outside of South Africa.