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SONA Focus on Energy Welcomed

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Gqeberha, South Africa, 17 February 2022 – Coega announced today that it welcomes the State of the Nation Address (SONA) 2023 by the President of the Republic of South Africa, His Excellency, Matamela Cyril Ramaphosa.

During his Address, the President outlined numerous plans to help manage socio-economic challenges associated with rampant crime, high unemployment, and of course, load shedding. Coega and its partners are fully committed to working with Government and supporting other parties to respond to these challenges. Moreover, the organisation is especially pleased and encouraged by a clear policy intervention in the Energy Sector.

The expansion of South Africa’s energy generation capacity is crucial to attracting foreign direct investment (FDI). There is a relationship between FDI and economic growth, with energy security as one of the key enablers. Therefore, Coega welcomes Government’s commitment to supporting the roll out of solar energy generation and other transformational energy-related projects across the country.

Some of these projects are located in the Coega Special Economic Zone (SEZ), and include the Mulilo Coega project, which entails the construction and operation of a 200-megawatt (MW) gas power station in Zone 13 as well as the 1 000 MW Coega Gas fired Power Project, which has recently commenced its Environmental Impact Assessment process, and is expected to reach completion stage in 2027.

“We are encouraged by the President’s support for industries to participate in energy generation. In terms of rooftop solar, Coega has been proactive in continuing with the rollout efforts of the Coega Solar Rooftop Project (CSRP) set for the initial implementation of 4,5 MW PV systems on the rooftops of Coega SEZ buildings, where this will place the SEZ at the forefront of being a green energy hub in South Africa. This is in addition to the solar panels pilot project already providing power to capacity of 42 Kw to Coega Headquarters, in Zone 1. The CSRP is implemented to allow energy flexibility and ensure energy security for Coega tenants, especially energy-intensive users. The first phase is to pilot the solution and ensure the resolution of any potential challenges before implementing phase two. The next phase comprises the installation of Solar PV systems to more than twenty (20) buildings. Following the SONA, we hope more buildings/locations in the Coega SEZ will benefit from the CSRP.

Moreover, a bigger view as an organisation is to develop the Coega Energy Strategy to guide future energy investments and reduce Coega’s carbon footprint, ultimately contributing to South Africa’s emissions reduction ambition and efforts to mitigate climate change, as the country charts its pathway to Net Zero Carbon by 2050. This is in line with the recently approved Coega Sustainability Framework, and the Government’s Nationally Determined Contribution (NDC), a commitment to the Paris Agreement, which seeks to lower national carbon emissions. Coega also supports the President’s approach to the Just Energy Transition Investment Plan, with R1.5 trillion prioritised over the next five years for investment in renewable energy options, including green hydrogen, and supporting growth in key manufacturing sectors such as the production of electric vehicles and battery storage,” says Coega Chief Sustainability Officer, Ms. Telly Chauke.

Together with the operational 342 MW Dedisa Peaking Power Plant, the Coega SEZ is home to two 2 MW wind turbines and seeks to grow its power generation capacity which is important to improve energy security and accelerate Coega’s drive toward energy security and sustainable development practices. Reliable and affordable energy supply is critical to drive increased industrialisation and stimulate inclusive socio-economic growth. The Coega Energy Strategy intends to focus on additional renewable energy solutions even outside of the SEZ, specifically across the country, within the programmes that Coega implements, as well as the projects that it undertakes on the continent.

In terms of Coega’s investor profile, the SEZ is currently home to three investors in the Energy Sector with a combined investment value of R3.86 billion, namely: Dedisa Peaking Power, Seraphim Solar Cells, and Seraphim Solar PV Modules. Relating to Renewable Energy investments in particular, the two Seraphim projects will assist in positioning South Africa as a manufacturing hub in the renewable energy sector as there is no manufacturing capability for solar cells and only limited Solar PV Assembly in South Africa, currently. In terms of socio-economic impact, Seraphim Solar Cells – located in Zone 3 of the Coega SEZ – is worth an investment value of R362 million with 350 operational jobs whilst Seraphim New Energy (South African subsidiary of Seraphim and solar products manufacturer), in the 4th Quarter of 2021/22 Financial Year, signed a lease agreement and investment worth R227 million in a 750 megawatts (MW) per annum module assembly facility, set to create 279 permanent jobs.

As a preferred investment destination in Africa, and a leading SEZ on the continent, Coega acknowledges the national investment target to mobilise more than R2 trillion by 2028 and we look forward to the 5th South Africa Investment Conference. To date, Coega has 56 operational investors with a total investment value of R11.89 billion.

Coega is also driving investment in the aquaculture sector through its dedicated Aquaculture Development Zone (ADZ) in Zone 10 of the SEZ, which is part of the Eastern Cape Provincial Oceans Economy Master Plan. This Project is targeted to create 500 construction jobs and an estimated 900 operational jobs which could be realised as private sector investments are made over the next few years. The Eastern Cape Provincial Government invested R206 million from the stimulus fund for the development of the first 100 hectares of the ADZ.

Coega welcomes the President’s comments on water as the country’s most precious natural resource that is vital to life, to development and to economic growth. Planned Coega projects include the construction of the Return Effluent (RE) Scheme, infrastructure upgrades in zones 3, 4, 5 and 6 for wastewater conveyance within the Coega Special Economic Zone, and the construction of the 15 megalitres per day sea water desalination plant (approval obtained for a 60 megalitres per day plant to allow for expansion). Coega has received a Coastal Waters Discharge Permit which enables the organisation to move forward with proposed coastal-dependent industries. Central to the implementation of these projects is the Coega Water Vision: to realise water security through the implementation of socially responsible infrastructure. The solutions-driven projects aim to pioneer sustainable development across the region. “As we continue to tackle water shortages across the region, Coega is working with the Nelson Mandela Bay Metro to address water security,” says Chauke.

Coega strives to develop an investment project pipeline aligned to the global shifts driving industrial transformation toward resource efficient and socially responsible investments, with a keen eye toward environmental sustainability, and remains a leading investment location for potential investors.

In a recent article by Business Live, the Deputy Minister of the Department of Trade, Industry and Competition, Honourable Fikile Majola, pointed out that, “The Coega SEZ has become a success story in Africa and has received awards recognising its accomplishments over the years. Its management and project implementation capacity has garnered much acclaim and the zone is attracting several large multinational corporations that have brought with them not just employment opportunities, but new innovations and technology, management and strategic skills, local supplier linkages and social investments in the surrounding communities.”

Coega welcomes Government’s dedication to infrastructure development as being central to economic reconstruction and recovery. As it strives to remain at the forefront of infrastructure development, working with its partners, by implementing projects that facilitate economic growth, socio-economic development, and employment opportunities within communities. Coega has been creating an investment ready infrastructure in the Coega SEZ which has enabled the growth of operational investors to world class companies.

In conclusion, Coega upholds the emphasis on the African Continental Free Trade Area which will lead to tariff lines reduced to zero over the coming years and service sectors broadened up throughout the continent. To date, Coega has expanded its expertise to twelve African countries following the call made by the President to promote development and the economic integration of the continent.

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Alan Straton

Chief Cook, Bottle Washer and Broom Mechanic at MyPE
Passionate about Port Elizabeth and definitely NOT packing for Perth. Alan's ethos is epitomised in the words of Nelson Mandela; "I have fought against white domination and I have fought against black domination. I have cherished the idea of a democratic and free society. If need be, it is an ideal for which I am prepared to die." See more articles by Alan.