The introduction of business revolution due to electricity tariff hikes…

There are a number of concerns regarding the consecutive electricity hikes of 45% for the coming three years. The one that i believe stems out the most is the potential for job losses. The executive director Roger Pitot of the  National Association of Automotive Component and Allied Manufacturers (Naacam) said on Wednesday that due to the tariff price increase by the power utility Eskom  would result in “the loss of many jobs in automotive component manufacturing” . He added that the situation would make industrial business more critical in terms of profitability and sustainability. Recently the construction of a smelter had to be canceled due to lack of capacity in power. However this might be one of the indicators of the necessity for the price increases due to strategies of increasing power capacity. The the obvious question how do we increase capacity with little damage to other business. One of the coal mines, Exxaro, is busy on a strategy on power congeneration. It might not cost considerably as compared to business which are not concerned with coal. The strategy Exxaro is implemented to cub impacts of electricity need might be a long term investment in promoting sustainability in terms of operation and production costs. There are a number of renewable technologies that can be implemented by other business to minimize impacts on the external factors over their businesses such as the electricity hikes. This also calls for a diversification of business whereby the business is not only focused in producing cars but also generating electricity, which one can call “business revolution”.  It is clear that electricity prices do affect the production costs hence profits which can result in job losses. Cogeneration of electricity should become a normal topic in the boardroom, shareholders need to tap into this investment for the sake of sustainability, this will also make business more independent and confident to project into the future. Now businesses instead have to hope and depend on the National Energy Regulator of South Africa (Nersa) for a  decision on the electricity tariff hikes. This results in many uncertainties hence making it more harder for business to lay down firm strategies for the future. Cogeneation is the way forward, it is high time that businesses put in funds for research either through tertiary institutions for renewable energy generation and not only energy industries such as Sasol but other industries can have a stake. Our Country is still developing which means that we now have the opportunity to invest and implement renewable energy technologies which will in turn feed into the knowledge based economy in the country. This has been the concern of government to integrate business with skills development in the country. It is now clear that the solution lies in the problem, the problems business are seeing might be the governments doorway for generating “intelligent” skills in the country. One example being that of cogeneration of electricity within industries who’s primal focus was not energy generation. This will in term in future 5 to 20 years down the line might serve as a means of generating profit, businesses will be able to feed back the power they generated back into the electricity grid.