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Businesses turn to smart solar solutions as Eskom woes continues

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Businesses turn to smart solar solutions as Eskom woes continues

As Eskom resorts to turning off the lights yet again, businesses are looking for ways to lessen their dependence on the beleaguered national power provider.

“The long-term risk to business continuity and sustainability is very concerning. Business owners cannot afford to sit on their hands and trust that government will resolve the situation, especially when alternative options are becoming more readily available,” says Tim Frankish, Managing Director of international solar energy company SolarSaver.

Electricity prices in South Africa have increased by over 350% in the last decade and a plethora of solar businesses have sprung up in response, but few offer solutions that don’t require major upfront capital investment. “Many business owners are reluctant to allocate millions of rands of capital expenditure to purchase a solar installation when that capital could be used to grow their core businesses,” says Frankish.

In response, SolarSaver takes a different approach: offering its clients solar photovoltaic solutions on a rent-to-own basis, eliminating the need for any capital investment on the part of clients. Customised systems are designed and installed free-of-charge, and clients then only pay for the cheaper, greener power that is produced.

“Our solar tariffs are significantly cheaper than the equivalent cost of grid power, so our clients get to start saving on their electricity bills from day one,” says Frankish. “Our rates then only increase in line with CPI inflation, so clients’ savings grow each year as grid tariffs increase significantly beyond that.” SolarSaver also remains responsible for all ongoing monitoring, maintenance and insurance. “We like to think of our offering as a ‘capex-free, hassle-free’ way to take advantage of solar power,” he adds.

The concept has proven extremely popular and SolarSaver now manages the largest fleet of self-financed rooftop installations in Southern Africa. Much of SolarSaver’s initial growth was in Namibia but the group is now increasingly focused on the South African market, thanks in large part to substantial investment backing from the Pembani-Remgro Infrastructure Fund (PRIF), a US$435m private equity fund established by Phuthuma Nhleko and Johann Rupert that focuses on infrastructure and energy-related investments in Africa. “The investment by PRIF gives us the ability to substantially grow our portfolio in South Africa on a sustainable basis. It’s very exciting,” says Frankish.

SolarSaver is, however, quick to point out that their core offering doesn’t yet solve the problem of load-shedding: “Standard, grid-tied, solar photovoltaic systems cannot operate when there is no grid availability, for example during load-shedding, for many technical reasons, but those systems are still a great first step for any business looking to reduce its dependence on Eskom,” suggests Frankish.

Frankish explains, “We’re not looking to sell expensive quick-fixes to our clients – we’re offering to invest our own capital to provide them with long-term solutions. Grid-tied solar doesn’t offer an immediate fix for the scourge of load-shedding, but we believe that by partnering with businesses and investing with a long-term view, we can start to provide real alternatives to Eskom.”

While initial solutions focus on daytime power generation through grid-tied solar, SolarSaver is already starting to update existing systems to include batteries as that technology becomes more cost-effective. Solar technology is rapidly evolving and decreasing in cost. Solar panel prices have decreased by 80% since 2008 and the lithium ion batteries used in solar applications have already halved in cost over the last two years. “Our long-term goal is to provide our clients with 24-hour power solutions through fully-financed, customised solar-battery systems,” says Frankish. “In the interim, our clients get to benefit from cheaper daytime electricity costs, without the expense or hassle of purchasing and managing the systems themselves.”

Edited by Neo Sesinye
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