STEAG EOH Energy Services, a strategic joint venture (JV) – formed in February by JSE-listed technology solutions provider EOH and German energy group STEAG Energy Services – has been actively pursuing opportunities in the local energy market, while identifying areas for localisation and skills development.
EOH energy cluster managing executive Jayesh Ranchod explains that the JV is a “strong collaboration” aimed at meeting the diverse and dynamic requirements of South Africa’s energy sector.
He adds that one of the JV’s objectives is to become the sector’s “first choice” with regard to engineering, technology, operations and maintenance services in the power generation sector. Additionally, the STEAG EOH venture will look to enhance technology localisation and skills development.
“The other objective is to develop skills, technology and advanced energy capabilities in South Africa by transferring appropriate engineering, operations and maintenance solutions and skills to local resources. This will result in a meaningful impact on the country as well as the sub-Saharan Africa region.”
Contextualising the venture’s establishment, Ranchod explains that two major requirements in Africa are enabling access to electricity and establishing a sustainable energy mix.
He further elaborates that energy is at the forefront of Africa’s political and business decision-making because of the “trade-offs” between three key goals: “energy security, social equity and environmental impact mitigation”. He adds that balancing these goals is the basis for prosperity and competitiveness of individual countries.
Ranchod points to the rise of innovative and disruptive business models for off-grid power solutions, which have reshaped rural development in Africa.
“By combining renewable technology with high-efficiency appliances, the latest storage technology and innovative mobile payment systems, entrepreneurs are delivering household solutions that increase rural electrification rates and scale up renewables in Africa.”
He notes that these developments have challenged the conventional wisdom of energy infrastructure development in Africa and are fuelling debates on off-grid versus on-grid solutions, as well as small-scale versus large-scale projects.
Therefore, the JV was, in part, formed to ensure that EOH is better able to adapt to the country’s and the continent’s rapidly evolving energy sector. Ranchod notes that “the South African energy mix has already changed dramatically with the introduction of renewable-energy solutions of all types”, as well as the noticeable shift from centralised generation by State-owned utility Eskom to distribute generation solutions for the consumers’ own requirements.
“EOH has over 500 engineers covering disciplines from civil, electrical, mechanical, chemical and industrial engineering. Our services across the energy conversion chain range from utility analytics, smart metering, energy management and efficiency . . . to smart resilient sustainable energy infrastructure implementation,” Ranchod states.
Partnering with STEAG, EOH will complement these existing skills and expand its competences in the design, engineering, the consulting phase and the operations and maintenance of power generation plants.
“Jointly, we are able to deliver services covering the complete value chain of power projects, from the initial feasibility studies and engineering through to the development of the plant, as well as the establishment and execution of the operations.”
Further, he notes that the JV’s ability to provide local resources and skills, together with globally proven processes, top-level support and expertise, and systems and technology, ensures a flexible service that can be completely tailored to meet each client’s requirements.
The 50:50 venture will remain focused on the South African market for now, although, he notes, where it fits with the strategy of STEAG EOH and both parent companies, the JV will pursue opportunities on the rest of the continent.
Another of the company’s initiatives is Youth Job Creation, which Ranchod notes is being widely emulated in South Africa. “This . . . initiative was pioneered and embraced by EOH with effect from 2012. It is being grown both within the company and in its partner ecosystem with the aim of creating 100 000 jobs by 2020.”