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An ongoing study funded by the World Bank under the guiding leadership of mineral research organisation Mintek has found that there are considerable opportunities for South Africa in the battery storage value chain.

The country, however, needs to move quickly to capitalise on these opportunities to ensure that valuable resources and financial benefits do not leave the region, it was revealed during the World Bank’s Battery Storage Value Chain Creation in Southern Africa Online stakeholder engagement workshop, held on December 9.

Customised Energy Solutions (CES) Power Sector India senior analyst Harsh Thacker told attendees that some of the opportunities already emerging from the World Bank study are found in new energy vehicles, as well as lithium-ion battery (LIB) cell manufacture.

The automotive industry is South Africa's largest manufacturing sector, with about 60% of vehicles being exported, especially to Europe. The industry has a strategic imperative to survive and, therefore, it must pivot to electric vehicle (EV) production to align with global and local targets in this regard, he stated.

For the latter, there is currently no LIB cell production in the country. This is, therefore, a longer-term goal, but would most likely be required to meet local content ambition, the study indicates.

A scenario impact comparison finds that the establishment of an LIB cell manufacturing facility and the production of EV batteries for the local automotive industry will create an additional 890 direct full-time equivalent (FTE) jobs in manufacturing, and 17 192 indirect FTE jobs.

This is notable for a country such as South Africa with a high unemployment rate, particularly among the youth.

The study emphasises that investment in EVs is critical to create a local integrated battery value chain in the country. Over 70% of battery requirements in 2030 are likely to come from the mobility sector in the South Africa market, Thacker said.

The study also highlights that investment in infrastructure, especially electricity, is a must in order for South Africa to compete in mineral beneficiation and mid-stream chemical activities.

Mintek CEO Dr Molefi Motuku highlighted that battery minerals were important for the country.

He noted that Mintek has been piloting capabilities and key recycling initiatives to support the development of segments of the battery value chain.

South African Energy Storage Association (SAESA) chairperson Mikhail Nikomarov also welcomed the work undertaken thus far. He noted that a previous study by the Industrial Development Corporation (IDC) had created interest in this sector, which is now being further bolstered.

Nikomarov said the battery storage market is lagging somewhat behind other industries, such as the wind energy sector, for example, where there is enough information on its impact and jobs, besides others , with these providing valuable insights into directing policy decisions.

The work done by the IDC, along with the information in the current study, would provide the opportunity to eventually decide which levers can be used, given that resources are limited, he said.

Moreover, it will play a key role in ensuring that employment is increased and that the country follows a just transition path, he said.

Nikomarov highlghted that the country has the capabilities to leapfrog in this arena. For example, he posited that, compared with developed countries, South Africa would not need to use natural gas as a transition fuel, but could go directly from coal-based solutions to renewable energy and storages solutions.

He also pointed out that there is potential for more storage beyond the current dedicated allocation, with the actual upside for storage within the Integrated Resource Plan possibility being much higher, which also widens opportunities for the country.

Moreover, there are three sources of potentially even higher amounts of storage through co-location with solar photovoltaic, wind energy and embedded ...

City Lodge Hotel Group’s new Courtyard Hotel Waterfall City, in Midrand, which opened on March 1, offers a full dining experience, a move away from a breakfast-only offering. This represents the vision for the group moving forward.

The National Energy Regulator of South Africa (Nersa) has finally initiated public consultations on Eskom’s 2022/23 revenue application, following a long delay that culminated in a December 3 court order instructing the regulator to make a tariff determination by no later than February 25.

The paper has been released together with Eskom’s fifth multiyear price determination (MYPD5) revenue application, which covers a three-year period, but the adjudication will be confined to the coming financial year, in line with the High Court judgment.

Eskom has applied for allowable revenue of R279-billion for 2022/23, excluding the R14.4-billion awarded to Eskom as a result of previous regulatory clearing account (RCA) determinations, which the regulator has already approved to be liquidated in the coming financial year.

The allowable revenue application together with the RCA decision translates to R293-billion, which if approved, would result in a 20.5% increase in the standard tariff from April 1. The municipal tariff increase would be 21%, effective from July 1, should Eskom’s full application be approved.

Eskom CFO Calib Cassim confirmed the utility's request for a 20.5% increase in a media statement, in which it also confirmed that the remaining two years of the MYPD5 application remained the subject of a court review application and would, thus, not be decided in February.

The application includes R79.6-billion for primary energy, R4.6-billion for international purchases, R70-billion to buy electricity from independent power producers, R66.7-billion for operating costs, R68.3-billion in depreciation, R6.6-billion for the environmental levy, R2.7-billion for the carbon tax and R5.7-billion for arrear debt.

A negative amount of R25-billion has also included for return on assets to allow for a slower migration of the price increase.

The application does not include any RCA amounts applied for but not yet approved and also does not anticipate any additional revenue being returned to it in 2022/23 following the regulator’s decision to illegally deduct a R69-billion equity injection from the utility’s allowable revenue for the period 2019/20 to 2021/22.

The matter is before the Supreme Court of Appeal, which will not make a ruling in time to influence the next tariff decision.

This did not stop Nersa from including an alarming table in its consultation paper outlining a possible hike of 54.35% for the coming financial year.

The calculation includes all RCA amounts, including those that have not been adjudicated, as well as the reintroduction to allowable revenue of a R46-billion government equity injection previously excluded.

Eskom said Nersa has "misrepresented Eskom’s revenue application to include various matters that are still under consideration by both the courts and by Nersa itself".

In line with the court order, Nersa has set 16:00 on January 14 as the closing date for stakeholder comments on the consultation paper on Eskom’s revenue application and will conduct virtual provincial hearings between January 17 and 21.

Hearings for the Western and Eastern Cape province have been scheduled for January 17, to be followed by KwaZulu-Natal (January 18), Free State, Mpumalanga and Limpopo (January 19), Northern Cape and North West (January 20) and conclude with Gauteng on January 21.

Nersa’s Electricity Subcommittee will meet on February 2 to recommend the draft decision and reasons for decision, with the Energy Regulator to make a final determination on February 25.

South Africa’s Mpumalanga province can compensate for a large share of the job losses that will arise in its declining coal sector and lay the foundations for the creation of a new clean-energy hub for the country by scaling up investments in renewable energy and accelerating coal decommissioning, a new study shows.

Published by the COBENEFITS project, which is financed via the International Climate Initiative, the study assesses the co-benefits of a transition from coal to renewable energy.

Using analysis conducted by the Council for Scientific and Industrial Research, Enertrag, Prime Africa, and Navitas Energy, the report includes various transition scenarios for the province and outlines the potential for job creation and local value creation, as well as skill requirements and opportunities for gender-inclusiveness.

Under the most ambitious scenario, dubbed the ‘Super H2igh Road’, up to 72 000 direct, indirect and induced jobs could be created in Mpumalanga by 2030, the study shows.

These are primarily in renewable-energy plant construction, with operations and maintenance accounting for 20% of the total jobs.

The scenario envisages this renewables capacity being deployed on repurposed Eskom sites, including Komati, Camden, Grootvlei, Arnot and Hendrina, as well as on coal mining land in the area. It also foresees the building of additional renewables capacity in Mpumalanga for green hydrogen production.

It draws its name from the ‘Super H2igh Road Scenario for South Africa’ produced earlier this year by IHS Markit and commissioned by Agora Energiewende. That earlier study suggested that, with a supportive policy and regulatory framework, South Africa could attract $106-billion in incremental investment to help realise its green hydrogen potential and create 370 000 jobs.

In the new co-benefits study, the scenario assumes an accelerated decommissioning of 17.8 GW of coal capacity as opposed to the 10.6 GW outlined in the Integrated Resource Plan of 2019 (IRP2019) and that Mpumalanga is allocated 15% of the new onshore wind and 20% of the solar photovoltaic to be built in South Africa by 2030.

Under the most ambitious scenario, the study calculates that almost three times more jobs can be created in Mpumalanga by 2030 than would be the case under an IRP2019-linked scenario, which would yield 27 000 jobs.

The number of jobs lost in the coal sector would depend on the number of power plants decommissioned over the period, with more than 74 100 assumed to be lost with the closure of 10.6 GW and about 123 600 to be shed should 17.8 GW be decommissioned.

The study acknowledges that not all job losses in the fossil-fuel sector can be compensated for by new clean-energy jobs in Mpumalanga.

“The decommissioning process is estimated to result in net job losses in the province by 2030.

“Therefore, a wider strategy for economic growth is needed, including other sectors such as tourism and agriculture.”

The Super H2igh Road Scenario also assumes that renewables investment in Mpumalanga could reach R321-billion over the period, representing a 172% increase on the R118-billion under the IRP2019 scenario. Under all scenarios, the local value creation associated with renewable-energy sources will outweigh the lost value arising from the coal decommissioning.

It adds that by increasing local content requirements from 30% at present to between 60% and 80%, gross output value in Mpumalanga could be increased to R343-billion.

To support a provincial clean energy industry, special economic zones could be established to provide an attractive environment for companies that provide the balance of electrical plant components, such as transformers, switchgear, and cabling, which together comprise up to 65% of plant value and are already manufactured competitively in South Africa.

The study also argues that the transition from fossil fuels to clean energy represents an opportunity to improve conditions for women working in the energy sector in Mpum...

Eskom COO Jan Oberholzer has once again highlighted the utility’s liquidity crunch as a key constraint to the execution of its much-vaunted reliability maintenance programme, which is seen as key to reversing the poor operational performance of its aged coal fleet.

The fleet’s energy availability factor has fallen to 64% year-to-date, resulting in 2021 becoming South Africa’s worst year yet for load-shedding.

The fleet comprises 15 stations, including the new Medupi and Kusile plants, with the average age of the remaining 13 stations standing at over 40 years.

Speaking during a webinar hosted by EE Business Intelligence, Oberholzer confirmed that only 18 outages had been implemented since the launch of the programme in early 2020, with a further nine currently in execution and 25 more in planning.

However, the utility had initially intended to implement 84 outages under the scheme and Oberholzer confirmed that 32 outages had been deferred, owing to a lack of finance and insufficient time and capacity to fully prepare for these.

Eskom has an internal outage-readiness target of 80%, but Oberholzer reported that most of the initial outages were conducted at readiness levels of about 60%.

The utility also required R11-billion yearly to maintain its generation assets, but only about R6-billion had been made available for the current financial year. In addition, the money had been released in stages, which had undermined planning and implementation.

Oberholzer insisted that the utility would still meet its internal target of having 10% of its fleet out for planned maintenance during the 2021/22 financial year, but he confirmed that it had failed to rein in unplanned outages.

Unplanned outages have surged to 24% year-to-date, well above Eskom’s 14% internal target, and the fleet has not become more reliable within the 18-month period set at the start of 2020 for its stabilisation.

Oberholzer said the liquidity problem required a holistic approach, which included cost savings, the recovery of municipal arrears debt, a cost-reflective tariff and a solution to Eskom’s unsustainable debt position.

Development Bank of Southern Africa energy specialist Lungile Mashele warned that lenders were equally concerned about the maintenance backlog and the slippage in plant performance, which “directly impacts the ability to raise funding”.

Mashele warned that, while lenders assessed Eskom holistically, its technical performance was falling below the threshold required for lenders to advance loans to the utility.

Oberholzer reiterated that maintenance progress was also being hampered by the procurement framework under which Eskom operated as a Public Finance Management Act (PFMA) entity.

He said people with “no idea” of Eskom’s operations were making key decisions, some of which were taking up to 90 days to be confirmed.

Eskom has previously indicated that it is waiting on average 77 days for the National Treasury to make decisions on its PFMA-related requests.

However, the National Treasury has indicated that requests for departures or deviations from the PFMA follow a specific process that require it to obtain a factual motivation, and other information, prior to an approval being granted.

“It is on this premise that we consider the 77 days to be inaccurate due to steps that are conducted in this regard,” the National Treasury told Engineering News in response to questions on the matter.

“I'm not saying we are blameless,” Oberholzer said.

“I believe sometimes the submissions that we make to the National Treasury are not of the quality and standard that they are supposed to be.”

An economic concentration study by the Competition Commission has revealed that, once markets are concentrated, they tend to become more concentrated and that more deliberate action is, therefore, required to change the trajectory of the economy.

In addition, the report largely found South African economic conditions and structures to be hostile towards small, medium-sized and microenterprises (SMMEs) and that this “undermines the inclusion and job creation potential of the economy”.

However, changes were made to the Competition Act in February 2020 to address these challenges and the commission started implementation of this mandate by introducing contraventions for the abuse of buyer power and price discrimination against SMMEs with a lower fair trading or impeding participation threshold.

The commission on December 7 also noted that the implementation of the mandate required it to strengthen market inquiries to enable the competition authorities to impose remedial action, including divestiture and interventions to promote competition.

Firm structure, and not only firm conduct, will also be a focus for the competition authorities moving forward, while simultaneously introducing more stringent regulations for mergers.

A report detailing the outcomes of the study, themed ‘Measuring Concentration and Participation in the South African Economy: Levels and Trends’, outlines the levels of concentration and participation in 178 markets and how these have been evolving over the past five to ten years.

The study makes use of data collected by over 80 industry organisations, regulators and government departments, as well as data from the South African Revenue Services (Sars), Statistics South Africa and the commission itself.

The economic sectors highlighted in the report include, but are not limited to agriculture, retail, forestry, health care services, financial services sector, media, energy, property, gambling, construction, automotive and the airline industry.

The report prefaces the origins of concentration in South Africa’s economy as a direct result of concentrated “market structure from the Apartheid era”, which the report said, “left the country with an economy characterised by excessive levels of concentration of ownership and control, as well as a lack of participation by all South Africans”.

Chief economist James Hodge, meanwhile, explained that the study found that about 70% of the markets reviewed were either highly concentrated (40%) with a dominant firm, or moderately concentrated (29%).

Only 10% of the markets under review were not concentrated, which Hodge said confirmed the commission’s findings that there was a need for the recent amendments to the Act “in order to address the system concentration in the economy”.

The markets that were identified as highly concentrated were, besides others, farming inputs, seed treatment, fertilisers, storage, animal feed, fungicides, insecticides, agroprocessing, and the so-called sin industries (liquor, tobacco and gambling), as well as healthcare, communications and mining.

The second major finding in the report was that highly concentrated markets were becoming more concentrated over time, highlighting the inefficient concentration.

Hodge explained that, in tracking the segments over a period of five to ten years, highly concentrated markets, with a dominant firm, were three times more likely to have seen increases in concentration over that period than reductions in concentration.

This, he said, was in stark contrast to unconcentrated or moderately concentrated markets where there is a greater likelihood that it may become less concentrated over time.

The finding is also consistent with the notion that dominant firms are more capable of raising intermediaries including rivals, which may reinforce their dominance over time.

While this confirms the need to focus enforcement on markets with dominant themes, Hodge said it also suggests that proactive measures are needed to en...

The National Economic Development and Labour Council (Nedlac) will approach the Constitutional Court early next year about proposals to implement mandatory Covid-19 vaccinations.

During a keynote address at the twenty-sixth Nedlac Summit, on December 7, Employment and Labour Minister Thulas Nxesi said the social partners agree with President Cyril Ramaphosa that mandatory vaccinations are necessary to ultimately do away with lockdown restrictions.

He pointed out that it has been a difficult two years since the start of the pandemic, with gross domestic product having contracted by more than 7% in 2020 and the labour market having shed one-million jobs.

The “pain” continues, in that the unemployment rate sits at 34.9% and the shadow of a fourth wave of Covid-19 infections with the Omicron variant looms.

“The pandemic placed a heavy responsibility not only on government but also Nedlac and its social partners. In such periods of economic, political and social crisis, the need for social dialogue and strong institutions become apparent.”

Nxesi mentioned that Nedlac was facilitating discussions on mandatory vaccinations, with a particular focus on the hospitality sector and that only vaccinated people be afforded access to venues and gatherings.

He added that increased ventilation and physical distancing protocols would continue to be adhered to.

Naturally, unvaccinated people would also have difficulty accessing destinations beyond local borders.

He was sure vaccine mandates would pass Constitutional scrutiny, which would pave the way for proper Covid-19 recovery, he said.

“We have to act decisively by upping our preventive measures, less we face further economic depressions.”

ECONOMIC FOCUS AREAS

Further, he noted that government’s focus remained green economy interventions, mass employment programmes, industrialisation, localisation and transformation.

Particularly, government had identified 42 product areas in sectors including agriculture, construction and consumer-related goods for increased localisation support.

Nxesi highlighted the need for social partners to promote locally manufactured goods, particularly from small businesses, as that held immense potential for job creation.

Some of Nedlac’s priorities for 2022 include addressing issues of energy – the country needs a plan for coal and to negotiate a just transition, the Minister stated.

He added that not much progress had been made on the social compact signed between Eskom and social partners, and this needed attention in the new year.

Nedlac also reiterated its commitment to reviewing current labour laws, regulations and processes to cut red tape and administrative costs, especially for small businesses.

The council would look to strengthen the present collective bargaining system.

Nedlac executive director Lisa Seftel in her presentation lamented that while economic growth had improved somewhat this year, mostly owing to the commodity boom, nearly 47% of work seekers could not find a job in the third quarter of the year, and while high commodity prices presented opportunities, it also led to risks, such as increased theft of cabling and other materials along rail lines.

She said the R15-billion worth of damage incurred to property and equipment during the civil unrest experienced in July also set back logistics and South Africa’s exports.

Seftel said the Economic Recovery and Reconstruction Plan announced by the President in October 2020 had become the reference point for progress on structural reforms and is a reflection of the commitment of all social partners to work towards this.

However, she noted the plan’s fatal flaw was that there were no agreed benchmarks or indicators to measure substantive progress.

To this end, Nedlac had set up both a seven-a-side Economic Recovery Leadership Team, including Cabinet Ministers, and a three-a-side leadership team to deal with escalations.

A process committee would manage the tracking of implementation and areas of col...

The National Energy Regulator of South Africa (Nersa) will release a consultation paper on December 8 alongside Eskom’s fifth multiyear price determination application (MYPD5), which covers the three financial years from 2022/23 to 2024/25.

The paper, which is currently being finalised, will outline why the tariff decision will be confined to the 2022/23 financial year, rather than all three financial years covered in Eskom’s application, which was formally lodged on June 2 and initially rejected by Nersa on September 30.

The decision to limit the adjudication to a single year was confirmed during a special meeting of Nersa’s electricity subcommittee on Monday, held after a High Court ruling on December 3.

The court set aside Nersa’s rejection of the application and ordered the regulator to make a final decision on Eskom’s revenue application by February 25 so as to ensure that a tariff is in place for legal implementation on April 1.

The consultation paper is also likely to outline previous revenue decisions made in Eskom’s favour as a result of regulatory clearing account (RCA) adjudications, at least parts of which will probably have to be liquidated over-and-above any tariff increase decided for 2022/23.

The paper is also likely to outline further amounts that could arise from ongoing legal disputes with Eskom, including a R59-billion residual claim arising from the regulator’s decision to illegally deduct a R69-billion equity injection from the utility’s allowable revenue for the period 2019/20 to 2021/22.

Eskom and Nersa reached a settlement whereby R10-billion of that equity injection was recovered in the 2021/22 tariff, with the balance subject to a Nersa Supreme Court of Appeal application.

In his December 3 ruling setting aside Nersa’s rejection of Eskom’s MYPD5 application, Judge Jody Kollapen also made the following order:

that Eskom’s revenue application submitted on June 2, 2021 be published on December 8, 2021;

that the public have until January 14, 2022, to make representations on the content of Eskom’s application;

that public hearings on the merits of Eskom’s revenue application be held between January 17 and 21, 2022; and

that Nersa shall make a final decision on Eskom’s application by February 25, 2022.

While the contents of Eskom’s 2022/23 application have not yet been made public it has been reported that the utility would be seeking a tariff increase of about 20% for the coming year.

Whether that reported figure includes the liquidation of all outstanding RCA amounts, and the full recovery of the equity injections, will become clear once the MYPD5 application is published by Nersa on Wednesday.

In the meantime, the Energy Regulator also approved the publication of reasons for decision relating to the principles to be used to determine future prices in the electricity supply industry.

The approved principles include the unbundling of activities across the value chain and the use of activity-based costing, as well as the unbundling of services within each activity.

These principles are expected to be integrated into the future tariff-setting methodology, which Nersa aims to finalise by July or August next year.

The world's first electric and self-propelled container ship – Yara Birkeland – has completed its maiden voyage in the Oslo fjord, Norway.

“We are proud to be able to showcase the world's first fully electric and self-propelled container ship,” says Yara CEO Svein Tore Holsether.

“It will cut 1 000 t of carbon dioxide and replace 40 000 trips by diesel-powered trucks a year.

The ship was built by Vard, with financial support from Enova, and will be in commercial operation from 2022.

“We have been looking forward to this day for a long time,” says Holsether.

“Yara Birkeland will transport mineral fertiliser between Porsgrunn and Brevik and will contribute to significant emission cuts during transport.

“This is an excellent example of green transition in practice, and we hope this ship will be the start of a new type of emission-free container ships.

“There are a lot of places in the world with congested roads that will benefit from a high-tech solution like this.”

The completion of the vessel’s maiden voyage will be followed by a two-year testing period of the technology that makes the ship self-propelled, to finally be certified as an autonomous, all-electric container ship.

The Yara Birkeland is a collaborative project between several actors, with the Kongsberg Group responsible for the delivery of all the newly developed technology on the ship.

The ship will be operated from Massterlys’ monitoring and operations centre in Horten.

Massterly is a joint venture between Kongsberg and Wilhelmsen.

“Norway is a big ocean and maritime nation, and other nations look to Norway for green solutions at sea,” says Kongsberg CEO Geir Håøy.

“Yara Birkeland is the result of the strong knowledge and experience we have in the Norwegian maritime cluster and industry.

“The project demonstrates how we have developed a world-leading innovation that contributes to the green transition and provides great export opportunities for Norwegian technology and industry.”

Enova, a government enterprise responsible for promotion of renewable energy, has allocated up to 133.5-million Norwegian Kroner to build the Yara Birkeland.

“On the way to a low-emission society, transport emissions must come down to almost zero,” notes Enova CEO Nils Kristian Nakstad.

“To achieve that, we need projects that can transform the market – projects that have the potential to pave the way for others and increase the pace of change in their sector. This is exactly what we believe the world’s first autonomous and all-electric container ship will do.”

Green Shipping

In parallel with the construction of Yara Birkeland, Yara has initiated the development of green ammonia as an emission-free fuel for shipping, through the newly started Yara Clean Ammonia.

“Renewable energy was our starting point in 1905,” says Yara Clean Ammonia CEO Magnus Krogh Ankarstrand.

“Now, ammonia can bring us back to our roots.

“Our large shipping network and existing infrastructure means that ammonia has the potential to become the leading fuel for long-distance shipping globally.”

As the world's largest producer of fertilisers, Yara relies on ammonia to make fertiliser, and to help feed an ever-growing population.

At the same time, current ammonia production represents 2% of the world's fossil energy consumption. This corresponds to about 1.2% of the world's total greenhouse gas emissions.

"As the world's largest producer of ammonia, Yara has launched an offensive plan of international scale, both to remove current emissions and to establish the production of new, clean ammonia," says Ankarstrand.

A new generation of ultra-large container vessels has been sailing the oceans in recent years. Container ships such as the Madrid Maersk, COSCO Shipping Universe, OOCL Hong Kong and Ever Golden can carry more than 20 000 TEUs (twenty-foot equivalent units).

These vessels measure around 400 m in length, with beams of between 49 m and 59 m, and a draft of 15 m.

Early container vessels were usually modified bulk vessels or tankers that could carry around 1 000 TEUs.

However, over the past 50 years, the capacity of container vessels has increased by around 1 500%, doubling over the past decade alone, says the South African Association of Freight Forwarders (SAAFF) in a newly published report which analyses the ability of local ports to handle a new generation of container ships.

This rapid growth has largely been influenced by shipping lines' focus on economies of scale to improve profit margins, says the association.

“In general terms, the more containers shipping lines can load on a vessel, the greater the income generated by these vessels.”

The extreme size of the new generation of container vessels is, however, creating a new set of physical problems, notes SAAFF.

For example, owing to strong winds, the Ever Given vessel earlier in 2021 blocked the Suez Canal, and a large portion of global trade, for six days.

Other problems include the limited number of ports that can receive these vessels.

Today Very Large Containerships (VLCSs) and Ultra Large Containerships (ULCVs) are the norm and too big even for the Panama Canal.

Furthermore, these ships come close to the limitations that the Suez Canal can accommodate today and remain limited to routes between Asia and Europe.

“Despite this, the situation serves as a warning to ports across the world, foreshadowing serious issues in terms of port capacities,” notes the SAAFF report.

“If ports and hinterland operations do not adjust to service these vessels to the best of their capabilities, these ports and countries could face some severe challenges, and possibly lose their spots in the supply chain due to bypassing vessels.”

WHAT ABOUT SOUTH AFRICAN PORTS?

The congestion struggles at South African ports is no secret, with the Container Port Performance Index (CPPI) 2020 ranking the country’s container terminals at the bottom of the global pile.

While there is some controversy around the index and its findings, there is no smoke without fire, with regular reports of congestion at ports, especially at the Durban Container Terminals, notes SAAFF.

“A significant contributing factor is that while the size of vessels is growing, our ports have not expanded much over the past decade.

“Furthermore, the same can be said for the rest of our infrastructure on which logistics operations rely heavily.”

Durban's prime container berths are dredged at 12.2 m, Cape Town at 14 m and Ngqura 18 m, with ultra-large vessels requiring a draft of at least 15 m.

Furthermore, the Durban container terminals have moved an average of 5 000 TEUs per vessel over the past few years, with vessel sizes at this port rarely exceeding 10 000 TEUs capacity.

The MSC Katarina (12 400 TEUs) and Cape Tainaro (11 000 TEUs) were some of the largest vessels to call at the Port of Durban in the last year.

Furthermore, for Africa as a whole, the maximum ranges stop at about 15 200 TEU.

As per Alphaliner's monthly monitor report, only four vessels are servicing Africa within a spread of 12 500 TEUs to 15 200 TEUs, says SAAFF.

“These figures suggest that our largest port is not coming close to being able to service these ultra-large vessels,” warns SAAFF

“Of further concern lately has been the lack of investment in our ports in recent years,” adds the association.

“It might also explain why South Africa's port performance has been deteriorating over the past decade.”

A POSSIBLE SOLUTION?

In addition to the need for ports that can accommodate larger vessels, shipping lines and cargo owners are also looking for ports to service ves...