Eskom delay threatening R400m venture at Coega
DOZENS of jobs and investments of more than R400-million in the renewable energy industry in Nelson Mandela Bay are on the line if Eskom does not authorise a raft of long-delayed power purchase agreements (PPAs) in South Africa’s renewable energy sector.
DCD Wind Towers, which was established in the Coega Industrial Development Zone with a total investment of more than R400-million, is facing closure by April, just more than three years after the heavy engineering concern started production of its tower components for wind farms.
The company, which halted production after completing its last contract in November, has since shed 29 jobs, with the remaining 143 people on short time and at risk of losing their jobs in April if no new wind farm projects are authorised.
The company has been relying on Eskom’s authorisation of 26 renewable energy projects.
DCD was to have secured a significant portion of work arising from the new projects.
Speaking from the massive, but completely inactive facility, DCD Wind Towers general manager Alta-Mari Grebe painted a bleak picture of the company’s future, which she said relied directly on the authorisation of new power purchasing agreements.
“Obviously, the company was established around the expectation of the continued roll-out of power purchasing agreements,” Grebe said.
“As a result of the halt or delay in this, production has stopped.
“In the middle of last year, we employed 172 people.
“Since then, we have already had to reduce our workforce by 29 people. The remainder of the staff are now on short time. If Eskom
does not sign the new agreements, we will have to shut down by April.”
Grebe said the company had been aware of the looming crisis and had made extensive efforts to address the situation.
“I wish they [Eskom] would just wake up and sign those PPAs,” she said.
“It is not just about saving the company, it’s about saving jobs.
“Do you know what it is like to see a man cry when he is told that he no longer has a job and cannot support his family?”
Describing her frustration, Grebe said: “It is like sitting on top of a mine with huge potential, but you can’t mine it.”
She confirmed that the Industrial Development Corporation (IDC), which invested R250-million, and the Coega Development Corporation (CDC), which invested millions of rands into infrastructure at the DCD site, were important stakeholders at the company.
Eskom did not respond to requests for comment yesterday.
It has claimed that the renewable sector projects resulted in a R9-billion net loss for the economy last year.
The municipality’s chief of staff, Kristoff Adelbert, called the possible closure a real tragedy.
“Eskom’s inability to process the [PPA] must be investigated urgently,” he said.
“Thus, we will engage with the Ministry of Public Enterprises to ask for an explanation and urge that this process be expedited to avoid these job losses.
“One of this administration’s primary focuses is to deal with the unacceptably high level of unemployment in Nelson Mandela Bay as a matter of urgency.”
The CDC and the IDC asked for more time yesterday to respond.