Steel institute launches Power Line Association of South Africa

6th September 2013

By: Samantha Herbst

Creamer Media Deputy Editor

  

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The Power Line Association of South Africa (Polasa) was launched last month under the auspices of the South African Institute of Steel Construction (Saisc) to represent the broader interests of power transmission and distribution line fabricators and contractors, and ensure that South Africa-based companies are involved in extending the country and the continent’s power net- work.

Newly elected Polasa chairperson and Ntuthuko Powerlines MD Gary Whalley said at the launch that the association hoped to create a vibrant and sustainable industry – more productive and significantly safer than it currently was – with the additional aim of creating and securing meaningful jobs.

“We stand as a group of companies who pro- vide a key service for the development of an electrical infrastructure system required by a country to underpin its economic growth and to develop into the future,” he said, adding that Polasa’s key customer, State-owned power utility Eskom, shares these aspirations and has challenged Polasa to “step up to the plate”.

The newly formed association would not cater exclusively to the steel industry, as there were unique requirements in the power line industry that were not addressed by Saisc alone.

“When establishing an association, one is always cognisant of the risks posed by anticompetitive behaviour, which is one of the main reasons for forming this association under the umbrella of Saisc – an institute which has been operating for many years and has well-defined mechanisms to ensure that we operate in ways that are not anticompetitive,” he explained.

Whalley further pointed out that Polasa should be inclusive of the distribution construction sector as a whole, as it provided a neces- sary breeding ground for new entrants to the business.

He highlighted Eskom’s aspiration to build 7 610 km of high-voltage transmission lines over the next five-year period, which equates to an average of 1 500 km/y.

The power utility’s aspirations for the following five-year period are less clearly defined but, based on growth imperatives, it aims to construct about 5 400 km of power lines at an average of more than 1 000 km/y.

“Considering that Eskom did not build more than 1 500 km over a 20-year period [prior to its new build programme], one can understand the challenge that now faces this industry,” asserted Whalley.

Meanwhile, those currently servicing Eskom constitute about 14 contractors, which employ more than 6 000 people in direct construction activities alone.

Whalley explained, however, that those com- panies supplying conductors, insulation, line hardware and tower steel employed a significant number of personnel who were further impacted on by Eskom’s new build programme, which, in the financial year ending March 31, resulted in the construction of 737 km of power lines – a number likely to increase by 100 km by the end of the current financial year.

Averting a Crisis
Despite significant potential for power generation industry stakeholders in the coming years, Whalley pointed out that five companies in the industry had recently been liquidated while one was currently under business rescue.

He further revealed that the high-voltage market had had no significant enquiries for more than 18 months. As a result, the industry faces a possible 12-month period that will lack in-phase production, as many power generation contractors have already completed their most recent projects.

“We have already suffered significant job losses in the industry and are currently under a short-term threat of losing 5 000 . . . jobs,” he added.


Moreover, none of the 11 projects currently under way will be completed within the current planned completion date.

“We do not build as fast as we used to. However, I do believe we can still do it,” asserted Whalley, reiterating Polasa’s aspiration to engage with government and Eskom to address the issues that have arisen in the power generation sector.

Purpose of the Association
Whalley described the association as a necessity in an environment where no company, despite its best efforts, would make the significant impact required to create a sustainable business environment, which was why Polasa was aiming to actively promote the development, growth and flexibility of its members to facilitate participation in training and education.

He highlighted education, training and development as integral to the development of the power generation industry and mentioned that this was best achieved as a group of companies and not as individual companies.

“Unfortunately, many industry associations have put a stop to their apprenticeship pro- grammes, but maybe it’s time that we, as an industry, start considering aspects of that nature,” asserted Whalley.

He also stressed the importance of developing a world-competitive industry under Eskom’s build programme that could be applied across the continent.

“An integrated transmission infrastructure in Southern Africa is becoming increasingly likely, given the pressure of green requirements in power generation and the expense of generating green energy.”

Whalley further argued that, considering South Africa’s imminent water crisis, a keen focus on exporting power should be a key objective for Polasa, as neighbouring countries might be able to mitigate South Africa’s water shortage.

He conceded that Polasa was a work in progress and that a lot more was needed to firmly establish the association.

“Nevertheless, we will support healthy competition between the companies and entities that currently comprise this association and will endeavour to resolve issues that restrict industry from performing at optimum levels of productivity, quality and safety. We wish to add value to engineering issues applicable to the industry,” he said.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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