{"id":19400,"date":"2013-04-24T23:55:55","date_gmt":"2013-04-24T21:55:55","guid":{"rendered":"http:\/\/www.myza.co.za\/tariff-hike-of-only-1-increases-mining-costs-to-r100-million-per-year-says-industry-expert\/"},"modified":"2013-04-24T23:55:55","modified_gmt":"2013-04-24T21:55:55","slug":"tariff-hike-of-only-1-increases-mining-costs-to-r100-million-per-year-says-industry-expert","status":"publish","type":"post","link":"https:\/\/www.myza.co.za\/press\/tariff-hike-of-only-1-increases-mining-costs-to-r100-million-per-year-says-industry-expert\/","title":{"rendered":"Tariff hike of only 1% increases mining costs to R100 million per year, says industry expert"},"content":{"rendered":"

An electricity tariff rise of only 1% has a devastating impact on the mining industry as it amounts to an increased expenditure of R100 million per year according to the South African Chamber of Mines. It therefore really hurts that since 1 April this year, large power consumers have had to fork out an average monthly 9,6% tariff increase. Energy challenges facing big business is high on the agenda at this year\u2019s African Utility Week which takes place in Cape Town from 14 to 15 May.<\/p>\n

African Utility Week
\nAccording to Nicolette Pombo-Van Zyl, programme manager of the Large Power User programme at African Utility Week: \u201cthe proverbial axe is falling on \u2018business as usual` as every industry in South Africa, from mining to manufacturing to retail, is cringing at the thought of rising energy tariffs and commencement of a carbon tax on 1 January 2015. On the receiving end of tariff hikes, industry is dealing with three significant elements, namely the cost of electricity, uncertainty around sufficient electricity supply and carbon emission management.\u201d<\/p>\n

More optimistic about jobs
\nAlthough some industry insiders have warned that the tariff increase could lead to 250 000 job losses, Dick Kruger, techno-economic adviser to the South African Chamber of Mines, is more optimistic.<\/p>\n

\u201cEskom previously indicated a 35% increase. Although 9,6% is high, we are nonetheless thankful that it is less than the 16% that Eskom eventually applied for. This increase will definitely not go unnoticed in an industry which has seen prices doubling over the last three years. However, at this stage we do not foresee any job losses or mine closures directly as a result of the increase. We have known since August 2012 that increases were on the way and mines could figure this into their short and medium plans.\u201d<\/p>\n

This means that mining companies had to seriously look at their operations and make adjustments such as the introduction of variable speed drive motors that have been known to cut energy use. Says Dick Kruger: \u201csome mines have already looked at replacing electric motors with variable speed drive motors and replacing compressed air drills with extremely expensive electric rock drills.\u201d<\/p>\n

According to Kruger, gold mines will be hit hardest: \u201cabout 60% of the total cost of the electricity consumption at gold mines goes towards creating an environment that one can work in. Large amounts of money are spent on ventilation, pumping and refrigeration. Only 40% of the expense goes towards production purposes.\u201d<\/p>\n

Power cuts of 2008
\nSome pockets of the South African economy are still trying to recover from the devastating effects of the first few months of 2008 when power cuts were a daily occurrence. This coincided with the global economic crash and thousands of jobs were lost across all economic sectors.<\/p>\n

At the time Eskom gave an undertaking to large power users that it would do everything possible to avoid power cuts to big business.<\/p>\n

\u201cEskom has made good on this undertaking. But there are other problems. In March (2013) the mines in Carletonville stood still for three days when transformers burned down and miners could not be sent underground. It also happens frequently that the power supply is not running on full strength which leads to work grinding to a halt. Although the mines do not generate income during these situations, the expenses do not decrease. Workers still need to be paid and the mines have to foot the bill for the ordinary daily running costs,\u201d says Kruger.<\/p>\n

\u201cThe mining industry has signed the Voluntary Energy Efficiency Accord committing itself to pursue a reduction in power use of 15% by 2015. Mines have already saved a lot of energy, but savings can only be done up to a certain point before production is compromised.\u201d<\/p>\n

Anglo American
\nIn a brief response about how Anglo American is dealing with unstable power supply and tariff hikes, the mining giant\u2019s spokesperson Hulisani Rasivhaga said: \u201cAnglo American is monitoring many aspects of Eskom\u2019s performance on a regular basis and is aware of Eskom\u2019s limitations. Anglo American and all its business units, is supporting Eskom by shedding load as and when required and as mutually agreed.\u201d<\/p>\n

The South African Chamber of Mines\u2019 Dick Kruger emphasises the need for more power generating plants: \u201cWhen the new Medupi power station in Limpopo and the Kusile station in Mpumalanga have been completed, we will be able to breathe again. At least for a while.\u201d<\/p>\n

African Utility Week\u2019s programme for Large Power Users includes:<\/p>\n

Free CPD accredited Technical Workshop programme on the exhibition floor:
\n\u2022 Cogeneration \/ power plants \u2013 new product development in turbine technology
\nJulio Cesar Bianchini, Commercial Manager \u2013 TGM Turbinas, ZEST WEG Group, South Africa
\n\u2022 Large energy savings through Compressed Air Management \/ Monitoring \/ Leak Detection and auditing
\nDevon Fisher, Audit Manager, Artic Driers International, South Africa
\n\u2022 Solar Rooftop projects for LPUs
\nClaire Lockey, Marketing and Communications, SolarWorld Africa, South Africa
\n\u2022 Sustainable energy solutions for businesses
\nWayne Fortuin, IDM Implementation Manager, Eskom, South Africa
\n\u2022 Renewable energy solutions for IPP\u2019s, Mining, Industrial and Corporate companies
\nReutech, South Africa<\/p>\n

Conference programme for Large Power Users:
\n\u2022 Mining perspective on sustainable energy efficiency performance to secure our future
\nCoenraad Pretorius, Energy Engineer, Anglo American, South Africa
\n\u2022 Making Energy Saving a Reality \u2013 from the Western Cape\u2019s largest electricity consumer that saved R90 million in one year
\nReinet van Zyl, Business Improvement Manager, ArcelorMittal, South Africa
\n\u2022 The human element \u2013 changing the workforce mind-set
\nPieter Pretorius, Senior Marketing Manager, 49M Initiative, South Africa
\n\u2022 Energy Management Standards and Systems \u2013 ISO 50001
\nAlfred Hartzenburg, Senior Project Manager: Industrial Energy Efficiency Project, National Cleaner Production Centre of South Africa (NCPC-SA), South Africa
\n\u2022 Managing tariffs: a discussion on the Price Impact Assessment project
\nShaun Nel, Project Director Advisor, Energy Intensive Users Group of Southern Africa, South Africa
\n\u2022 Carbon and energy reduction initiatives at Woolworths
\nJustin Smith, Head of Sustainability, Woolworths, South Africa
\nThe exhibition and the technical workshops are free to attend if visitors pre-register on the event website.<\/p>\n

The dates for African Utility Week are:
\nExhibition Conference: 14-15 May 2013
\nPre-conference Workshops: 13 May 2013
\nSite Visits: 16 May 2013
\nLocation: CTICC, Cape Town
\nWebsite: www.african-utility-week.com<\/p>\n

Contact:
\nCommunications manager: Annemarie Roodbol
\nOffice: +27 21 700 3558
\nMobile: +27 82 562 7844
\nEmail: annemarie.roodbol@clarionevents.com<\/p>\n

URL<\/strong>:
Twitter<\/strong>: https:\/\/twitter.com\/AfricaUtilities<\/a>
Facebook<\/strong>:
YouTube<\/strong>:<\/p>\n

Author: Annemarie Roodbol<\/strong> from African Utility Week<\/a>. Originally distributed by MyPR.co.za<\/a>.<\/strong><\/strong><\/p>\n

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\nAfrican Utility Week to give practical solutions to solve power challenges facing big business<\/p>\n","protected":false},"excerpt":{"rendered":"

An electricity tariff rise of only 1% has a devastating impact on the mining industry as it amounts to an increased expenditure of R100 million per year according to the South African Chamber of Mines. It therefore really hurts that since 1 April this year, large power consumers have had to fork out an average […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","ngg_post_thumbnail":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1],"tags":[3257,1452],"class_list":{"0":"post-19400","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-south-africa","7":"tag-mypr","8":"tag-public-relations","9":"entry"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/posts\/19400","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/comments?post=19400"}],"version-history":[{"count":0,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/posts\/19400\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/media?parent=19400"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/categories?post=19400"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/tags?post=19400"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}