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Ray of light for SA businesses seeking energy security
Rolling blackouts, a 15% increase in Eskom tariffs and permission by government for companies to produce their own electricity without a licence to 100MW is encouraging businesses to look for alternative energy sources.
It is in this view that Standard Bank is proud to announce the launch of PowerPulse, a collaborative and innovative solution that Standard Bank has launched aimed at eliminating the challenges that energy consumers, mainly Commercial and Industrial clients, face when trying to procure an alternative energy solution.
“Energy security, both cost and supply, is one of the biggest obstacles businesses and the broader economy face in South Africa and, given expectations that it will continue for the foreseeable future, expedited renewable energy solutions are a necessity,” says Berrie de Jager- Executive Head – Natural Resources at Standard Bank.
Solar photovoltaic (‘PV’) solutions, can power a business from the sun in less than six months. The simple solution is created by a complex combination of funders, service providers and other players in the energy chain and energy providers.
To negotiate the complexities of the process, Standard Bank clients use PowerPulse, a jargon-free digital platform that provides legal, technical and funding guidance on what needs to be considered in setting up a reliable and compliant solar energy installation by approved suppliers and installers, as well as guiding businesses to get their installation in place.
Avoiding the money pit
Reliability isn’t the only consideration – solar plants need to pay for themselves.
Not all systems and suppliers are created equal and a project intended for financial respite can turn into a never ending money pit. Unnecessary friction, delays, cost overruns and transaction costs from the installation of these solutions can delay the period where the project reaches cash-neutrality.
Cash-neutrality is achieved when the payback period, the time it takes for a renewable energy system to pay for itself, is complete. Projects funded by bank debt now typically have payback periods as short as five to six years. “There are so many reasons why these payback periods are not met,” says de Jager.
Factors that can impact the payback period include, the current blended electricity tariff, the size of the system in relation to the amount of power needed, the average amount of power the location is able to receive from the sun, and the technology that is chosen.
A fast-tracked solution for an urgent business problem
“Businesses need collaboration between renewable energy service providers and financial institutions,” says Deerosh Maharaj – Senior Manager – Power and Sustainable Solutions at Standard Bank.
A solution like PowerPulse ensures that businesses are connected to credible solution providers who understand the requirements that need to be adhered to in order to make the project beneficial and bankable, he says.
To be allowed on the platform, solution providers are vetted according to specific criteria and agree to terms as well as the standards of services. The platform is based on transparency and the process is designed to provide insights and empower the client to make informed decisions about their solar projects. The platform is targeted at businesses wanting to install solar systems with a cost above R250 000, with no constraint on the upper size limit. It allows the energy user to manage a single installation or a portfolio of sites.
PowerPulse is accessed through OneHub which Standard Bank has also recently launched. OneHub is a digital solutions marketplace for businesses which has recently been recognised by Global Finance as one of the 10 “outstanding innovations in corporate finance” as part of its annual ‘The Innovators’ programme.
Easy to access, with bankability top of mind
Businesses do not pay to register on PowerPulse, and all costs for installation and ongoing services will be outlined in the proposals provided through the platform. “The funding will be based on the energy users overall credit worthiness. With a clear and standardised approach, the platform saves time and ensures that your project is structured with funding in mind, with no unnecessary time or money spent,” says Deerosh Maharaj.
PowerPulse has been designed for business users with varying levels of knowledge about renewable energy solutions and with the platform being brought to the market by Standard Bank, there is always a link to the funding expertise within the bank and finance packages can be customised to the selected solution. “PowerPulse minimises time spent on trying to understand how solar PV can be beneficial – but rather puts things into action,” says Kevin Ssemwogerere – Lead – Corporate Venturing at Standard Bank.
The platform aims to be technology agnostic in the future. But now the focus is mainly on solar photovoltaic (PV) solutions given their convincing economic viability. “In the meantime, solutions incorporating other technologies will be assessed on a case-by-case basis,” says Ssemwogerere.
Click here for more information on how to register on the PowerPulse platform and begin your journey to energy cost-cutting and resilience today.