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Young South Africans, aged 35 and younger, are demonstrating a growing preference for private mobility.

This is evident in recent WesBank data that shows a consistent increase over the past three years in the number of vehicle finance applications for new and pre-owned cars by Millennials and Gen-Zs.

This upward trajectory was tracked from 2021, when 722 505 vehicle finance applications were received from young people aged 35 and younger.

This number increased to 806 458 in 2022, and 826 088 by 2023.

"This is contrary to previously held views by industry experts who suggested that a desire for private car ownership would wane amongst Millennials and Gen-Zs in favour of alternative forms of transport, such as e-hailing services," says WesBank marketing and communications head Lebo Gaoaketse.

"Vehicle purchases among this age group have, however, indeed slowed down, as reported in 2023 by data analytics firm Lightstone, which noted that those under 35 accounted for 39% of new car purchases in 2012, but only 31% in 2022.

"Viewed in conjunction with WesBank's vehicle finance applications data, though, it becomes clear that the subdued sales are not a result of diminished desire for personal cars, but rather a symptom of a depressed economy and strained affordability across all age groups, including Millennials and Gen-Zs," says Gaoaketse.

To stimulate sales, manufacturers, dealerships and finance houses have ramped up their incentive programmes in recent times by offering discounts, alternative finance structures and extended loan terms to ease the load carried by consumers seeking to purchase a car.

"For recent graduates, for instance, who might not have a credit history, WesBank introduced a graduate finance programme, which grants young people access to vehicle finance despite not having a credit record," notes Gaoaketse.

"However, more needs to be done to help young South Africans attain their aspiration for safe and reliable private mobility, which in many cases can also be a key consideration for a successful job application.

"It may also be necessary for those seeking vehicle finance to consider more affordable alternatives in the pre-owned space or among value-oriented importers that have recently entered the local market," he advises.

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Food processing company Tiger Brands has unveiled a new peanut butter manufacturing facility for its Black Cat brand in Chamdor, Krugersdorp.

Having moved from another facility in Randfontein, the company has invested R300-million in the new facility that offers more space, increased peanut processing capability and the opportunity for research and development to improve its products.

The new facility is located on 8 610 m2 of land and produces, on average, one-million jars of peanut butter a month.

During an official opening of the factory on April 12, Trade, Industry and Competition Deputy Minister Nomalungelo Gina welcomed the continued investment by Tiger Brands in the country, saying it signals the company's confidence and commitment to localisation.

The investment in the new facility marks the single-largest capital investment that Tiger Brands has undertaken in South Africa, to date.

CEO Tjaart Kruger said consumers want more affordable and healthier food options and the company intends to tweak its recipe and packaging to ensure the best price point for consumers.

In particular, the company has upgraded its packaging line for greater flexibility and quicker innovation.

The new facility will enable improved efficiencies and a lower cost profile, allowing Tiger Brands to maintain its prominent position in the spreads market and to remain responsive to customer needs. Additionally, the new factory includes a canteen and training centre that could not be accommodated at the prior facility.

The peanut butter category accounts for 50%, or R1.7-billion of the total South African spreads market, excluding margarine, and is worth R3.4-billion.

Black Cat peanut butter was first launched in 1926 and has grown to be one of the best-selling brands in the market with five-million kilograms sold every year in formal retail stores. Consumer research shows that Black Cat is found in seven out of every ten South African households.

Tiger Brands culinary MD Dumo Mfini said the significant investment by Tiger Brands would further strengthen and grow a proudly homegrown brand. He added that, as consumers seek value for money, the company is well positioned as one of the top manufacturers in the market to meet their needs of affordability and nutritional value, with the added benefit of superior quality that Black Cat is known for.

The Krugersdorp peanut butter facility produces two ranges of peanut butter - the mainstream variety that contains 91% real peanuts, with the balance of the product comprising sugar, salt and stabiliser, and 99% peanuts variety that contain no added sugar or salt.

Tiger Brands procures between 10 000 t and 20 000 t of ground nuts every year from local and international markets. Mfini noted that about 70% to 80% of peanuts can be sourced locally, with the balance needing to be imported.

The new facility allows Tiger Brands to remove the peanut skins during processing, which are sold as animal feed. Nearly 60 t of this by-product is extracted and sold every month.

Notably, the peanuts undergo a process of inspection for quality and safety before processing, roasting, blanching, colour sorting and milling. The plant is largely automated but managed to retain the 62 full-time employees that worked at the Randfontein site previously.

Mfini pointed out that peanuts are a major source of protein for many households, with every 100 g of nuts containing 25 g of protein - which is more than eggs.

Given that peanut butter is a staple in many households, Gina was encouraged by Tiger Brands' plans to make its products more affordable and better suited to consumer needs as they evolve.

Engineering News editor Terence Creamer discusses the halt in loadshedding over recent weeks; what South Africans should expect for the higher-demand winter period; and the longer-term outlook for South Africa's electricity sector.

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Contractual negotiations are under way between the developers of the HySHiFT sustainable aviation fuel (SAF) project, in Mpumalanga, and the intermediary company set up under Germany's H2Global scheme, known as Hintco, which enters into long-term purchase contracts for clean hydrogen and derivatives such as ammonia, methanol and SAF.

Speaking at Resources for Africa's 2024 Hydrogen Discussion in Johannesburg ENERTRAG business case development manager Jonathan Metcalfe reported that the project, which was being developed by Sasol, Linde, ENERTRAG and Hydregen, had been selected as a preferred bidder and that the negotiations for a ten-year offtake deal could be concluded by mid-2024.

"We are currently in contractual negotiations with Hintco … and we are ready to commence detailed engineering [having already] completed the front-end engineering design on the project."

Through H2Global, long-term purchase agreements are extended to projects producing green-hydrogen-based products outside of Germany, which are then sold under short-term contracts to European consumers, with public funding used to compensate for any difference in pricing.

Through HySHiFT, the plan is to used renewable electricity from wind and solar resources in an electrolyser to split water into hydrogen, which will be used to displace a portion of the coal-based hydrogen that Sasol uses in its Fischer-Tropsch reactors to produce carbon-neutral kerosene.

The target is to produce 50 000 t/d of such kerosene, which could fuel two daily flights between Germany and South Africa.

The offtake agreement with Hintco could play a significant role in ensuring the project's bankability, but Metcalfe indicated that the ten-year contract was not sufficiently long to ensure prices that were low enough for a binding offtake agreement. Discussions were, thus, ongoing with the European Union and Germany about a longer-term floor price.

Improving demand-side conditions for green hydrogen projects was also highlighted as a priority by International Energy Agency energy technology analyst for hydrogen and alternative fuels José Miguel Bermúdez Menéndez, who cautioned that initiatives to stimulate demand for green and low-emission hydrogen were lagging production ambitions.

He said the number and size of announced projects was growing rapidly, which could result in production of 35-million tons by 2030, against potential demand from a combination of policy initiatives, aggregation and private offtake currently estimated at between 10- and 19-million tons for 2030.

"Without robust demand, low-emission hydrogen producers will not be able to secure offtakers that are needed to underpin the large investments that are required, which jeopardises the viability of the entire global low-emission hydrogen industry," Menéndez warned.

He called for bolder actions to stimulate demand, particularly for existing hydrogen uses.

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The City of Cape Town should have battery electric buses (e-buses) operational on its MyCiTi bus service by 2027, says Urban Mobility MMC Rob Quintas.

It will be the city's second stab at rolling out the zero-emission technology, following an unsuccessful attempt as an early adopter in 2018.

E-buses has since experienced significant progress in terms of range and technology.

Quintas tells Engineering News Online that the Cape Town council gave the Urban Mobility Directorate the go-ahead to proceed with adopting alternate energy buses as part of MyCiTi Phase 2A.

Phase 2A will expand the bus service to run between Mitchells Plain, Khayelitsha, Wynberg and Claremont.

"At this point in time it is foreseen that the first routes will be operational by mid-2027, if all goes as planned," says Quintas.

However, the service will not only use e-buses.

Cape Town's Climate Change Action Plan commits the city to transition to electric or alternative-fuel-powered freight, bus, taxi and passenger vehicles by 2050, explains Quintas.

In terms of this plan, the city's Urban Mobility Directorate is mandated to develop a procurement strategy for low-carbon-emission vehicles and fuel technologies in pursuit of carbon neutrality.

This initiative also aligns with the national Department of Transport's Green Transport Strategy (2018 - 2050) which states that 10% of municipal bus fleets must use clean energy within the next 10 to 20 years.

"As such, the directorate has initiated a procurement strategy aimed at zero-emission vehicle solutions for the city's bus fleet," notes Quintas.

"The first step was to identify the most suitable alternative or green-vehicle and fuel-technology options for the MyCiTi bus service, supported by the necessary infrastructure.

"The directorate conducted a feasibility study of alternative-energy vehicles, including compressed natural gas, hydrogen electric, battery electric, hybrid and Euro VI [internal combustion engine] buses.

"Key recommendations from this study advocate for the adoption of a dual strategy, involving the acquisition of both [cleaner] Euro VI diesel buses and battery electric buses for the upcoming procurement cycle for the roll-out of the second phase of the MyCiTi bus service," says Quintas.

Quintas emphasises that the city will continue to investigate alternative fuel options given the continuous technology changes within the zero- and low-emissions transport industry.

"These need to be monitored to ensure the city procures the best available technology at the time of procurement."

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A new study has found that South Africa's fossil fuel subsidies tripled between 2018 and 2023, rising to R118-billion from R39-billion over the period, with subsidies having been increased largely in response to the surge in fuel prices following Russia's invasion of Ukraine in 2022.

Titled 'Blackouts and Backsliding: Energy Subsidies in South Africa 2023', the International Institute for Sustainable Development (IISD) report calculates that oil and gas subsidies more than doubled over the five years to R52-billion compared with R23-billion in 2018.

The value-added tax exemption on the sale of petroleum, diesel and illuminating paraffin remained the highest-value oil and gas subsidy at R30-billion, but other oil and gas subsidies also increased.

These included a freeze on the general fuel levy on petrol and diesel in February 2022, which was then reduced by R1.50 a litre from April to June, resulting in R12.6-billion in foregone revenue to the National Treasury.

The IISD argues that these "untargeted" subsidies were mostly skewed in favour of richer consumers and recommends that they be redesigned initially to support vulnerable consumers and eventually replaced with alternate social welfare support.

The subsidies were increased largely in response to the global energy crisis and came as global fossil fuel subsidies hit a record of $1.5-trillion in 2022, with governments around the world scrambling to respond to the energy crisis.

The balance of the fossil fuel subsidies in South Africa in 2023 arose from carbon tax exemptions for large emitters such as Eskom and the electricity sector more broadly, where coal accounts for 86% of all generation.

The largest electricity subsidy arose in the form of the Free Basic Electricity access programme at R10.6-billion.

However, the IISD questions the effectiveness of the 50 kWh monthly allowance, arguing that it should be at least 250 kWh and redesigned to ensure that poor and vulnerable households were genuinely able to access the subsidy.

"Soaring fossil fuel subsidies in South Africa mean the country is still locked into dependence on economically volatile fuels, with ill-targeted consumer subsidies failing to protect the poorest families," said report co-author Anna Geddes, who is an associate consultant at IISD.

South Africa, the report notes, committed to phasing out inefficient fossil fuel subsidies as a member of the G20 in 2009 and, more recently, as part of the COP28 agreement to triple the world's installed renewable capacity to 11 000 GW by 2030.

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State-owned electricity utility Eskom will reduce planned maintenance to 3 000 MW during the upcoming winter season and will seek to keep unplanned breakdowns to below 14 000 MW in a bid to navigate the high-demand period with limited loadshedding.

During the summer period, from September to the end of March, the utility set a target of restricting unplanned breakdowns to 14 500 MW during the high-maintenance summer months, when average planned maintenance levels of 7 000 MW were targeted.

During those periods when breakdowns exceeded the target, loadshedding was typically implemented, at times at high levels of intensity of between Stage 4 and 6.

While the winter outlook was still being finalised, Eskom Generation's Eric Shunmagum confirmed during a briefing on the implementation of the Energy Action Plan that it should be released later this month.

He also confirmed that the diesel budget for the 2024/25 financial year would be below the R30-billion set aside for the operation of the Eskom and independent power producer open-cycle gas turbines in 2023/24; a budget that he confirmed had been marginally exceeded, without providing specifics.

The diesel budget for the current financial year, meanwhile, would be communicated at a future briefing.

Speaking amid a sustained period during which Eskom had not resorted to loadshedding, Shunmagum stressed that the winter plan, as with previous plans, would contain three scenarios, with the base scenario likely to indicate only limited loadshedding for the period from April to the end of August.

He also insisted that Eskom Generation would work to ensure that breakdowns were kept below the 14 000 MW level to further reduce the threat of loadshedding.

However, the coal fleet remained unreliable with intense recovery work still under way at six priority stations, including Majuba, Matla, Duvha, Kendal, Tutuka and Kriel, which had replaced Kusile on the list after Kusile's performance was deemed to have recovered following the introduction of temporary stacks.

EAF TARGET MISSED

Meanwhile, Electricity Minister Kgosientsho Ramokgopa confirmed that the Eskom fleet failed to achieve the 65% energy availability factor (EAF) target set by the board for the end of March, coming in at only 54.6%. The performance was even below the 56% EAF reported by Eskom in its previous financial year.

Nevertheless, Shunmagum described the target as non-negotiable and insisted that the 65% to 70% target remained intact for the current financial year.

Ramokgopa attributed the failure to achieve the EAF target to "aggressive planned maintenance" efforts, which he said were prioritised ahead of lifting the EAF to closer to 60%.

"Planned maintenance increased from 9.3% in FY2023 to 12.0% in FY2024 reinforcing the commitment to execute the recovery plans and reduce plant risks," he said.

The Minister also insisted that various additional capacity was scheduled to be added or returned to service over the coming five months, including: Medupi Unit 4 in August, where a second-hand generator was being installed after a unit was crippled by a fire incident in August 2021; Koeberg Unit 2, which is currently scheduled to return from an extended outage in September; and Kusile Unit 6, which is also currently scheduled to be synchronised to the grid in September.

"In the next five months, we should be able to get 2 583 MW of new generation capacity [from Eskom]," Ramokgopa said.

He also played down concerns that up to 2 100 MW of Kusile capacity would be unavailable from November, when the three units that are currently bypassing the flue-gas desulphurisation (FGD) plant using temporary stacks, were scheduled to start being reconnected to the FDG through the west stack.

The west stack was rendered inoperable when Kusile's Unit 1 flue duct collapsed because of an unco...

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Forestry, Fisheries and the Environment Minister Barbara Creecy has granted Sasol South Africa permission to employ a load-based limit to regulate the sulphur dioxide (SO2) of its Secunda boilers in a decision upholding the JSE-listed group's appeal of an earlier National Air Quality Officer (NAQO) determination stipulating the use of a concentration-based limit.

Sasol lodged an appeal on July 31, 2023, after NAQO published a determination on July 11, 2023, stating that it was not empowered to grant permission to Sasol to apply an alternative limit for SO2 after a once-off postponement had already been granted to the Secunda operations.

The 17 Secunda boilers are currently operating on the basis of a ten-year postponement, until March 31, 2025, in the meeting of new plant standards for SO2 emissions, which was granted on February 23, 2015.

Sasol requested that it be allowed to reduce its SO2 emissions by reducing the total number of boilers in use at Secunda and thus the load, rather than by reducing the concentration of SO2 produced by each boiler.

NAQO argued that the load-based limit did not comply with the concentration-based limits prescribed in the Minimum Emission Standards (MES) and could, thus, not be considered.

Sasol stated in its appeal that the Minister was empowered to consider a fresh 12A application under the National Environmental Management: Air Quality Act.

The group argued in its appeal that this approach would result in an improvement of ambient air quality within the local airshed over and above MES compliance, while ensuring that its operations continued. It said a refusal would result in it winding down the Secunda Operations.

On April 5, the Minister upheld Sasol's appeal and set aside the decision of the NAQO.

In a statement, Sasol said the Minister concluded that its application met all the requirements of Clause 12A, and replaced the NAQO's decision by permitting that a load-based limit of 503 t/d of SO2 be applied from April 1, 2025, up to March 31, 2030.

"We will engage with the Minister to finalise the regulatory requirements for the decision to take full effect, following which our atmospheric emission license will have to be varied accordingly," the company added.

Just Share, which opposed Sasol's appeal, said the upholding of Sasol's appeal would result in emissions significantly above those permitted by the MES, which the organisation said were already weaker than comparative standards around the world.

"This decision means that the government has permitted a private company to set its own pollution limits, making a mockery of pollution laws and constitutional rights, and of any claim by the government to take public health seriously," Just Share added.

Creecy noted that those dissatisfied with the decision had the right to apply to a competent court within 180 days to have the decision judicially reviewed.

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Leading African independent power producer Globeleq says the 153 MW/612 MWh Red Sands project, which was recently awarded preferred bidder status under South Africa's inaugural battery storage public procurement round, will be the largest standalone battery energy storage system (BESS) in Africa and will carry an investment value of R5.7-billion.

It is smaller than the 225 MW/1 140 MWh BESS deployed at Scatec's Kenhardt project, also in the Northern Cape. However, Kenhardt is a hybrid solar-battery project developed under the separate Risk Mitigation Independent Power Producer Procurement Programme, which requires the plant to produce 150 MW of dispatchable electricity daily from 5:00 until 21:30.

The Red Sands project was originally developed by African Green Ventures, which Globeleq acquired last year from Magnora, a Norwegian company listed on the Oslo Stock Exchange.

Located about 100 km southeast of Upington, the lithium-ion battery project will be constructed on a 5 ha site and will connect to the grid through the Eskom Garona substation, which Globeleq says will be upgraded by Red Sands to ensure that full network support capabilities of the batteries can be utilised.

Red Sands was not initially named as a preferred bidder on November 30, when Minerals Resources and Energy Minister Gwede Mantashe announced the first four preferred projects selected following Bid Window One (BW1) of South Africa's Battery Energy Storage Independent Power Producer Procurement Programme (BESIPPPP).

However, Mantashe also announced that "value for money" negotiations were under way with a fifth bidder with the aim of having the bid window's full 513 MW/2 025 MWh allocation assigned to independent power producers across the five Northern Cape substations selected by Eskom.

The four projects identified were the 103 MW Oasis Nieuwehoop and 77 MW apiece Oasis Aggeneis and Oasis Mookodi projects, bid by an EDF Renewables-led consortium and the 103 MW Scatec-led Mogobe, located at the Ferrum substation.

On March 28, the Department of Mineral Resources and Energy (DMRE) announced that negotiations with a fifth bidder had been concluded and that the Red Sands project had been selected as a preferred bidder for development at the fifth substation selected for the round, which was launched in March 2023.

Globeleq CEO Mike Scholey expressed delight at Red Sands having received preferred-bidder status and said the company looked forward to working with government to advance the project to financial close and into operation.

Globeleq says the project will take 24 months to construct after financial close, which is expected later this year.

"Electricity storage is going to be key not only in helping South Africa meet its considerable industrial and domestic demand for energy but also in meeting growing demand right across Africa as more and more renewable energy projects benefit from the advances our industry has made with battery storage technology," Scholey said.

Red Sands will be Globeleq's first large-scale BESS project in South Africa where the group also owns and operates six solar photovoltaic plants and two wind farms with a total generating capacity of 384 MW.

The company, which is owned 70% by British International Investment and 30% by Norfund, also owns a combined solar and BESS plant at Cuamba in Mozambique and is developing other BESS projects across the African continent.

Meanwhile, the DMRE recently launched a request for proposals for BESIPPPP BW3, which has a 616 MW/2 464 MWh allocation across five pre-selected substation sites in the Free State.

A bid submission deadline of July 31 has been set after the deadline for BESIPPPP BW2, which was launched in December for sites in the North West province, was extended from April 30 to June 6.

Engineering News editor Terence Creamer discusses the latest developments with regard to the procurement of new electricity generation capacity and storage.