Generator power a ‘necessary cost’ for African business

24th April 2015

By: Mia Breytenbach

Creamer Media Deputy Editor: Features

  

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As grid power is intermittently available – or even entirely unavailable – owing to delays in new build permanent power generation, transmission and distribution infrastructure, the additional price for generator power has become a necessary and acceptable cost of doing business, says temporary power and temperature control solutions provider Aggreko.

Industry will always be the biggest energy consumer, particularly heavy industries such as mining, which is why several national utilities are addressing the issue by investing in power generation infrastructure and upgrading transmission and distribution networks, says Aggreko Africa MD James Shepherd.

While this will take years to establish, there is significant latent demand for energy, with only two countries in Southern Africa – Namibia and South Africa – with electrification rates of more than 50%, notes Shepherd. Nevertheless, other power producers, such as Mozambique and Tanzania, are emerging.

With this in mind, Aggreko has invested heavily in expanding its coverage by opening new service centres across the Southern African region. “We now have facilities in Johannesburg, Cape Town, Port Elizabeth, Durban, Walvis Bay and Luanda and, together with our strong presence through power projects in Mozambique and Botswana, Aggreko is never too far away from any Southern Africa customer.”

Aggreko’s strategy is to establish a local presence in strategic locations, says Shepherd, pointing out that the company currently operates in 30 African countries and that its business is supported by nine service centres across Africa and global hubs in London, Dubai and Paris. He adds that, as African economies grow, Aggreko will continue its expansion across the continent.

Shepherd also highlights the broadening diversity of the company’s customer base. “Aggreko supports a substantial range of industries – from major events, the petrochemicals sector and services, to the construction, mining and utilities sectors. “ This indicates how well accepted rental power has become over the past five to ten years,” he says, noting that Aggreko has played a key role in enabling this mind-shift.

Shepherd further reiterates that the acceptance and preference for rental power is definitely increasing, particularly in the mining sector. “As one of the largest users of power, mining operators are increasingly recognising the benefits of rental. “This enables operators to avoid the capital outlay required to buy generators. However, from a finance perspective, rental fleets remain a significant operating expense.”

He adds that the acceptance and preference for rental is definitely growing. “From a finance perspective, rental fleet remains as an operating expense, thereby avoiding the huge capital outlay required to purchase generators. “From a capacity perspective, when renting modular equipment, capacity can be quickly increased or decreased as required.”

Shepherd points out that Aggreko’s diesel generation fleet hire in Africa ranges from 20 kVA to 1 500 kVA.

Aggreko’s key projects include a 350 kVA power package to the Kwale mineral sands mine, in Kenya, which is operated by Australian titanium producer Base Resources; the supply of a 10 MW temporary power solution to the Moma mineral sands mine, in Mozambique, which is owned and operated by Ireland-based Kenmare Resources; and power provision for the 2014 Brazil FIFA World Cup and the 2012 London Olympic and Paralympic Games.

“Another key example is a 24-hour call centre in Port Elizabeth, for which Aggreko currently provides the standby power. The centre staff know that their standby power is guaranteed and they don’t need to invest in equipment and human resources to run a noncore part of their business,” concludes Shepherd.

Edited by Samantha Herbst
Creamer Media Deputy Editor

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