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Solar-geyser manufacturers taking steps to revive flagging sector

Solar-geyser manufacturers taking steps to revive flagging sector

31 July 2015 | Posted in SWH-MANCOSA.

Solar-geyser manufacturers taking steps to revive flagging sector

However, he warns that the very survival of the industry is of genuine concern, prompting the organisation to initiate a study to quantify the number of jobs that are being threatened by the prevailing uncertainty – the study should be completed by mid-August.

SWH-Mancosa’s seven members – Franke Water Heating Systems, Heat Tech Geysers, Kwikot, Powerz-on Solar Systems, Satchwell Solar Supplies, WE Geysers and Xstream Solar Hot Water Cylinders – collectively employ close to 2 000 people excluding the installation sector, which is said to be far more labour intensive.

In parallel, the industry body is reaching out to various government departments and standards bodies in a bid to lay the foundations for a sustainable domestic SWH manufacturing industry and to accelerate the installation of geysers that could reduce pressure on South Africa’s constrained electricity grid.

The Sustainable Energy Society of Southern Africa has estimated that SWHs could remove about 18% of Eskom baseload and shave up to 15 000 MW from peak demand. Government had an official target of installing a million systems by March this year, but only about 425 000 SWH were eventually installed.

Breckenridge says it is receiving strong support from the Department of Trade and Industry (DTI), which is keen to encourage domestic solar-geyser manufacturing, which has also been “designated” as a sector requiring 70% local content for both tanks and collectors to qualify for public procurement programmes.

In the longer run, the DTI is also aiming for South Africa to be an export hub for SWHs, especially into the rest of Africa; an aspiration also held by SWH-Mancosa, which falls under the auspices of the larger South African Capital Equipment Export Council. The body has had less success in gaining access to the DoE, which also failed to respond to questions sent to it by Engineering News Online regarding the nature and timing of the future rebate programmes.

But SWH-Mancosa, which is just over a year old, is determined to create an atmosphere based primarily on finding solutions, rather than one of criticism. He also reports that it has been receiving some positive indications about the design of the future programme, which could go a long way to reviving the industry.

Although Engineering News Online has been unable to verify the nature of the future architecture of the rebate programmes, it believes that the DoE is seeking to work more closely with the insurance industry to ensure that solar geysers form part of insurance companies’ geyser replacement offering.

With the support of a rebate, insurers would be able to incentivise households to opt for a SWH instead of a traditional electric geyser, with an initial target of ensuring that 10% of the 40 000 monthly geyser replacements are solar. The intention is to ramp that up to 30% by 2020 to ensure that the local manufacturers were in a position to meet demand. In addition, it is anticipated that there will be a separate programme for the continued installation of SWHs across low-cost housing developments.

Such a framework would be supported by the DTI, which indicated that the industry could be stimulated by programmes that involved the procurement, by the government, of the low-pressure systems for human settlements and a high-pressure system roll-out, back by the insurance industry.

But spokesperson Sidwell Medupe said that it would also be important to strengthen the enforcement of the stipulations of the building regulations on energy efficiency for the new buildings energy-efficiency standards.

Breckenridge says that it would be a “fantastic win” for the domestic industry should such programmes materialise.

But he says there is also a need to sort out the current bottleneck surrounding testing of new systems and the verification of localisation.

The South African Bureau of Standards is currently the only South African National Accreditation System-accredited testing facility. However it is said to be experiencing difficulties in fulfilling its mandate. It is anticipated, therefore, that the National Regulator for Compulsory Specifications could, in the coming months, accredit a separate private testing facility to bolster capacity.

In parallel, SWH-Mancosa is hoping that the current anomalies in the compulsory specification for hot water storage tanks and for solar systems can be addressed. “Our immediate goal is to gain access to the main decision-makers so that the manufacturing industry can become part of the solution to the industry’s current problems,” Breckenridge concludes.

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