Powerway, a solar component manufacturer, is gearing up to take occupation at its new facility in the Coega industrial development zone (IDZ) in May – and aims to create jobs for about 2 000 people over the next three years.
Powerway PV SA and JA Solar Holdings recently formed a joined venture to establish a PV module assembly plant in Port Elizabeth with an initial nameplate capacity of 150MW. Benson Wu, Powerway chief executive, said the Coega IDZ location was an investment hotspot and the first phase of the investment was valued at R300-million with a further three phases planned for the coming years totalling a R1.2-billion.
“When considering our investment we have taken a long term view, informed by a commitment to local community. South Africa has the best irradiation resources in the world and it makes sense for us to place our manufacture operations here – the market here is the best in long term.”
At the new factory more than 250 people will be employed and Powerway will increase job opportunities for about 2 000 people over the next three years.
“The IDZ delivers good investment infrastructure. The Port (of Ngqura) exports and imports goods speedily and there is also a good logistics hub we can tap into,” Wu said of the rationale behind the investment.
Wu added that Coega’s human resource recruitment and management support and the proximity were additional factors informing their decision to locate in the Coega IDZ. “Coega is also close to our key market in the Northern Cape.”
Other factors benefitting the company are government incentives around solar component and other manufacture with a drive for localisation of production central to policy such as the 2013/14-2014/15 Industrial Policy Action Plan (IPAP).
South African minister of Trade and Industry, Rob Davies said localisation is now fully entrenched in a number of key procurement programmes, including the renewable-energy generation programme. The requirement for local content has also recently increased to 40% for the third bidding window of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).
Powerway’s investment will go a long way in ensuring localisation happens, said Ayanda Vilakazi, Coega Development Corporation head of marketing and communications: “We are focused on diversifying the industrial base, which traditionally is centralised on the automotive industry, and renewable energy manufacturing investments such as Powerway’s contribute immensely to such objectives.”
Wu describes Powerway as a one-stop power solution provider that offers “full system integration service to the solar energy market, ranging from rooftop to utility scale solar farm”.
The company’s investment contributes to manufacturing in the renewables sector and Powerway specialises in a variety of solar panels, inverters, cables to mounting structure, installation, construction, and operation and maintenance.
As a Foreign Direct Investment (FDI), Powerway is confident about its Coega IDZ and South African investment: “Being the gateway to other countries on the African continent, and the one African country that signed a free trade agreement with Australia, Europe, USA and SADAC, South Africa second to none as a FDI destination.”
The company’s innovative leasing business model will offer the market practical solar solutions, especially for industrial and commercial buildings, which will help solve the power shortage problems of the country.
Wu said in future, “people can install solar systems in rooftops just like buying a new premise, by paying 20% to 30% upfront, letting the lease company finance the balance”.
“The solar rooftop solution not only helps the landlord to solve the power supply issue, but also adds to their asset portfolio with valuable assets.”
The South African Department of Energy (DoE) introduced the REIPPPP to deploy alternative sources of electricity in the country to meet growing demand and reduce the occurrence of black-outs and its success has kick-started significant growth potential in the country.
The two initial tender phases of REIPPPP attracted major international project developers and module manufacturers as well as leading component suppliers such as SMA Solar and Powerway to the country.
Over 1GW of photo-voltaic projects were sanctioned under the first two REIPPPP rounds with several utility-scale projects completed in 2013.
Alan Straton
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