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Eskom renewable energy IPP delays threaten transport investments

By South African Renewable Energy Council (SAREC) on 27 February 2017
Absolute Rigging, a transport specialist in abnormal loads, invested R60 million in equipment since 2014 in order to haul wind turbine components for new wind farms, and increased its staff by 50. Eskom delays threaten this investment. Picture: © Absolute Rigging
Delays by Eskom to sign off the next round of state-commissioned wind farms has cost a local black-owned transport and rigging company 30 jobs since November 2016.

Now, if the state utility does not follow through on the Minister of Energy’s instruction to finalise contracts with the independent energy firms that are earmarked to build and run these farms, it could further jeopardise the hauling operator, which since 2014 has upgraded its facilities to the tune of R60 million in order to meet the new growth in the renewable energy sector here.

Absolute Rigging, a Cape Town-based specialist in hauling abnormal loads, has been shipping steel and concrete wind tower segments between manufacturing plants in Cape Town and Port Elizabeth, to new wind farms being built in the Western and Eastern Cape provinces since 2014. It also ships blades and turbine generator housings (the ‘nacelle’) from local ports.  

But orders for tower parts have dried up since November 2016, and no new shipments are coming from the wind tower manufacturers.

‘We have a had letter of intent from our next (wind farm) client since April 2016, and were meant to start shipping the tower segments in September last year,’ explains Absolute Rigging owner Armien Hassiem.

However, construction has still not begun on this farm near Cookhouse in the Eastern Cape, and orders cannot be processed.

This delay is due to the failure of Eskom to finalise the power purchase agreements (PPAs) with private energy firms which the Department of Energy (DoE) has already approved as part of its utility-scale renewable power programme which started in 2011. Since then, the department began commissioning 96 renewable plants, using mostly solar and wind technologies, and about half of these plants are already operational and selling electricity to the grid. But construction is on hold on the next round of 26 plants, owing to Eskom dragging its feet on the price that it will pay for the electricity that these plants will provide to the national grid.  

Until now, Absolute Rigging has specialised in servicing the oil, gas, mining, and construction industries. However, Hassiem says the firm invested R60 million in additional equipment for hauling abnormal loads for the wind industry in 2014 when he saw that the domestic rigging industry lacked the specialist equipment needed to move turbine components around the country. This includes truck tractors, multi-axle and extendable blade trailers, cranes, as well as specialist ‘tower clamp’ trailers that can’t be repurposed for hauling other abnormal loads.

The company also hired an additional 50 staff to join the existing 80 in order to accommodate this growth in demand. 

These jobs include heavy duty and escort vehicle drivers and their assistants, project managers, supervisors, and site managers. The company also hires a number of unskilled labourers on the delivery side, to assist with offloading the cargo.  

A typical load

The first power plant which the rigging operation delivered components to was the 138 megawatt Gouda Wind Farm, about 110km north of Cape Town. It took eight months to haul the 782 loads of concrete tower sections, each of which weights 55 tons. 

However, the boom in wind farm construction came to a halt in late 2016 as new plants await contractual sign-off from Eskom. 

The last order for tower segments that Absolute Rigging shipped was in December 2016, from Port Elizabeth-based manufacturer DCD Wind Towers. Earlier this month, it was reported that the factory was on the brink of closure, owing to these delays, as the facility has been standing idle since the last orders were shipped out.

During last week’s budget speech, finance minister Pravin Gordhan announced the Treasury’s commitment to the DoE’s renewable energy programme, and energy minister Tina Joemat-Pettersson has instructed Eskom to finalise these agreements. However Eskom has given no firm date on when it plans to respond.

ar-3-ar Absolute Rigging, a transport specialist in abnormal loads, invested R60 million in equipment since 2014 in order to haul wind turbine components for new wind farms, and increased its staff by 50. Eskom delays threaten this investment. Picture: © Absolute Rigging
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