From pig-manure power to wind farms, Virginia’s Dominion Energy is transforming itself into a renewable energy powerhouse—and Berkshire Hathaway’s cash will only accelerate the process. 



“Pigs are extremely efficient,” says Kraig Westerbeek, who oversees renewable energy production for Smithfield Foods, the world’s biggest pork producer. For what farmers put into them, they get a lot out. “They eat 2.4 pounds of feed per pound of gain,” he says. “And they produce more gas per pound of live weight.”



Westerbeek is talking about greenhouse gases emitted by the millions of pigs his industrial farms produce each year. Inside his giant barns, manure and urine ooze through holes in a concrete floor before getting piped to open-air ponds called lagoons—some the size of four football fields. In these lakes of livestock waste naturally occurring bacteria—called methanogens—continue to feed and fart out more gas. All this methane ends up in the atmosphere, and that is bad news for the planet. Pound for pound, methane packs 25 times the greenhouse effect as the standard environmental villain, carbon dioxide. To make matters worse, it’s long been standard practice for farmers to spray the odoriferous lagoon waste on croplands as rich fertilizer—subjecting Smithfield and its former hog-producing subsidiary, Murphy-Brown, to environmental litigation and scathing publicity as local communities cope with the stench and health risks.



But today, Westerbeek has a better story to tell. In recent years Smithfield has been working to perfect methods of capping lagoons with heavy plastic covers that trap the methane (and much of the reek). The gas inflates the plastic domes in amounts sufficient for people to walk on—like an extremely gross air mattress. Smithfield has partnered with Richmond, Virginia-based utility giant Dominion Energy to market the gas. Under the plan, Dominion will siphon the pig gas out of these anaerobic digesters, inject it into interstate pipelines and sell it to green-minded customers looking to cut their carbon footprints. The end result is arguably the cleanest electricity in the nation, says Dominion Chief Operating Officer Diane Leopold. “It’s a win-win-win.” With renewable energy projects, she says, “it’s about how many boxes you can check. This one has an extra box.”



Over the next decade, Dominion aims to invest $650 million into agriculture-derived gas projects. Smithfield will contribute another $250 million. The expected result: 8 billion cubic feet per year of livestock gas—thus preventing the emissions equivalent of 3.5 million tons per year of carbon dioxide. That’s like taking 750,000 cars permanently off the road, or planting 60 million new trees every year. It may sound gimmicky, but replacing just 12% of fossil fuel gas with methane captured from pigs, dairy cows or landfills “can make everything net zero” on an emissions basis, says Leopold.



Helping to underwrite those investments will be the $10 billion ($4 billion cash; $6 billion assumed debt) that Berkshire Hathaway&nbsp;<a href="https://www.forbes.com/sites/eriksherman/2020/07/06/berkshire-hathaway-dominion-energy-natural-gas-pipeline/#204094d3481c">said Monday</a>&nbsp;it will pay for Dominion’s 7,700 miles of long-haul gas pipelines. Dominion had to sell its pipelines to fund investment into renewables, says Hugh Wynne at SSR. And that gave Warren Buffett the opportunity to double down on Berkshire’s pipeline holdings, at a good price. “Buffett is taking advantage of their situation,” says Wynne.



For Buffett, the deal complements Berkshire Hathaway’s existing 16,000-mile pipeline network, thus supporting his bet that natural gas will put the final bullet into coal and be a mainstay of U.S. power generation for decades to come. Berkshire already owns massive wind farms that generate 6,600 megawatts across the West—so it is also knee-deep in renewable energy. And Berkshire’s money will do double environmental duty, as Dominion will use some of the cash to help build its green future. All told, Dominion expects to make some $55 billion of investments by 2035 into low-carbon energy sources—spurred on by Virginia’s aggressive new mandate for 100% carbon-free electricity by 2045.



What a departure this is from the old Dominion Energy. The utility was founded as Virginia Railway &amp; Power Co. in 1909 by Frank Jay Gould, son of robber baron Jay Gould. Its roots are firmly planted in Appalachian coal. Even as late as 1995, when its current CEO Tom Farrell came on board as general counsel, more than half of its power came from burning coal.



Over the past 15 years, Dominion has slashed its carbon dioxide emissions by 52%, first by replacing coal-fired power plants with cheap and plentiful natural gas, and more recently by investing in solar and other renewables. In a decade the carbon intensity of Dominion’s power generation has fallen from more than 1,200 lbs. of CO2 per megawatt-hour to less than 600 pounds. This is in the lowest quartile of American electric utilities, according to consultancy MJ Bradley Group.



A big contributing factor: the changing economics of renewable power. “Solar was not affordable; five years ago we didn’t have a single panel,” Farrell says. Now Dominion, which had profits of $1.4 billion on revenues of $16.5 billion in 2019 (and whose dividend yields 5%), is the fourth-largest solar operator in the country.



Dominion is far from alone in its rush into renewables. Since 2003—when coal provided 51% of America’s electricity—the nation’s power utilities have dramatically cut back their combustion of coal in favor of renewables and cleaner-burning natural gas. Currently, coal fuels just 17% of electricity, and renewables have surpassed it for the first time ever. This trend is just getting started. With its new 2045 mandate for zero-carbon electricity, Virginia joins California, New Mexico, New York, Washington and Hawaii.



After $40 million in R&amp;D write-offs they settled on perfecting the systems being deployed today, whereby each farm’s manure lagoons have been turned into anaerobic digesters that capture its gas and sends it via pipeline to a centralized processing plant. After about three weeks in the digester, what’s left of the manure comes out the other end as sterile, nutrient-rich organic matter used as fertilizer or even livestock bedding. The now less odoriferous water is sprayed on crop fields. The Dominion/Smithfield joint venture will deploy systems at hog operations in North Carolina, Virginia and Utah.



Dominion is also working with startup Vanguard Renewables, which deploys similar systems at dairy farms. Vanguard is backed by the foundation of eBay billionaire Jeff Skoll, among others. It already has 42 diary farms signed up. Vanguard’s president, Kevin Chase, says that even though so-called dairy digesters had been perfected in heavily subsidized Europe over the past decade, owners of natural gas pipelines were initially skeptical at letting in bovine gas. “It was guilty until proven innocent,” says Chase, whose Wellesley, Massachusetts-based company has since landed long-term contracts with Vermont Gas, Middlebury College and Polar Beverages.



Though plenty of municipal sewage systems utilize similar digesters to process human waste, these aren’t as cost-effective because of the plethora of other stuff people put down the drain. “Animal waste is cleaner and more homogenous,” says Chase, because we know that the hogs and cows are eating and what’s coming out. A solution for chicken waste remains an elusive “Holy Grail” because its high ammonia content makes it extremely caustic and tough to process.



Renewable fuels are a priority at the EPA. To ensure that refineries and utilities use the mandated volumes of green fuels, the EPA requires that they either generate or trade for compliance credits (called Renewable Identification Numbers). Thanks to its negative-carbon attributes, livestock gas qualifies for the highest-value credits—meaning that customers could pay Dominion ten times more for hog gas than for the same quantity of gas fracked out of shale formations. That could be enough to generate an additional $100 million a year in revenue.



Not everyone is impressed by the potential for renewable natural gas. “Putting it into a pipeline is better than letting it go loose,” says William McDonough, visionary architect and author of <a rel="noreferrer noopener" href="https://mcdonough.com/cradle-to-cradle/" target="_blank">Cradle To Cradle</a>, about the need for a circular carbon economy. “But it’s still a fugitive carbon. To say it’s the cleanest energy is not correct, if you’re considering climate change.”



McDonough favors using ever-cheaper solar and wind power to electrolyze water into hydrogen. “Green hydrogen” and other climate-friendly efforts are already in the works at Dominion. COO Leopold says they’ve successfully blended 10% hydrogen into their gas-fired power plants; “It’s expensive at the moment, but solar was expensive, too.”



In the years ahead, Dominion could well become Virginia’s biggest private landowner due to all the solar panels it expects to install. And it’s begun replacing diesel-powered school buses with electric ones statewide. Offshore in the Atlantic Ocean, Dominion this summer has installed the first two of what could be hundreds of 800-feet-tall offshore wind turbines generating 2,600 megawatts.  (Reflecting its renewable energy efforts, Dominion has been named to Forbes’ annual <a href="https://www.forbes.com/sites/maggiemcgrath/2019/11/12/inside-the-2020-just-100-how-we-rank-americas-best-corporate-actors/#6e3a06d55bc4">Just 100 list</a> of socially responsible companies.)



Even after Dominion has transitioned from nearly all-coal to zero-carbon in a generation, it will still be looking for the next best thing. Maybe nuclear fusion? “I don’t doubt it,” says Farrell. “A sustainable company is one that adapts to challenges and weathers the storm.”



&#8211; <a href="https://www.forbes.com/sites/christopherhelman/">Christopher Helman</a>, Forbes Staff, <a href="https://www.forbes.com/energy">Energy</a>

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How Buffett’s $10 Billion Pipeline Deal Is Doing Environmental Double Duty Helping Dominion Energy Turn Acres Of Manure Into Clean Power

One of the most influential fathers of electricity generation in Africa died in the early hours of July 12 aged 90.



Ian McRae, a consummate public servant was born in Germiston, Johannesburg, on September 24 1929 . He joined Eskom, South Africa’s national power generator and the biggest generator of electricity in Africa, as an apprentice fitter and turner in 1947.



McRae qualified with a degree in mechanical engineering and worked his way up to the top of the company in nearly half a century of service laying down the bedrock of the power supply that South African business took for granted for decades. He oversaw the construction of the country’s big six coal-fired power stations, in the 1970s: Kriel, Matla, Duvha, Tutuka, Lethabo, Mathimba, Kendal and Majuba; as well as the country’s three hydro-electric stations: Gariep, Vanderkloof and Cahora Bassa, plus South Africa’s nuclear plant at Koeberg, near Cape Town. McRae was head of operations from 1977 to 1980, head of engineering from 1980 to 1984 and chief executive from 1985 until his retirement in 1994.



Sadly, McRae, a gregarious man-of-the-people, spent his last four months isolated in a home in Edenvale in Johannesburg because of the COVID-19 lockdown. McRae’s remarkable courage came through in his meetings with the ANC in 1988, his promotion of equal opportunity during the height of the apartheid era, and his legendary “electricity-for-all” electrification campaign. These initiatives helped Eskom pre-empt and adapt to the social changes of the 1990s and on retirement McRae left the power generator in good order producing a plentiful supply of some of the cheapest electricity in the world; power that gave birth to a large smelting industry in South Africa. He was also an energetic member of the World Energy Council and the World Association of Nuclear Operators.



“There is no doubt that his integrity, credibility, drive, inherent humility and care for people, also profoundly helped to motivate Eskom staff during many difficult times. In addition, his tenacity of purpose and commitment as a team player enabled Eskom to achieve its strategic goals in the late 1980s and early 1990s, and to survive unscathed through the political transition period of South Africa,” says writer Peter Adams, a former Eskom spokesman, who ghost-wrote a biography of the man.



“A key theme of the book is leadership, and in particular the kind of leadership McRae practiced at Eskom during its phases of both growth and then downsizing. This was essentially one of empowering people within a framework of a clear and inspiring vision. The book is also about McRae the man – his strength and weaknesses, his sense of serving others and Eskom. This is thus the story of a person who has served his fellow man, his company and his country with distinction and humility, using his God-given skills of leadership. In several places in the book, Dr. McRae mentions how being a good mentor is one of the attributes of the outstanding leader. Having benefited himself from good mentorship, Dr. McRae helped to establish the strong culture of mentorship that exists in Eskom today.”



McRae’s wife Jess predeceased him last year, his daughter Heather, died in 2018. His son, Donald, who has written books on boxing and South African rugby, survives him and is a journalist living in London.

Ian McRae

One Of The Influential Fathers Of Power In Africa Dies Aged 90

On February 28, Sandton, known as Africa’s richest square mile, witnessed a wave of red berets and angry faces, as members of the Economic Freedom Fighters (EFF) took to the leafy streets lined with commercial buildings, to protest the power cuts crippling South Africa. The country has seen a spate of load-shedding in recent months due to the Eskom crisis. In this image, an EFF member lapses into a serene moment, looking up helplessly, amidst all the singing and chanting at Innesfree Park where the masses had gathered ahead of a march to the state power utility’s head offices in Sunninghill, singing struggle songs and disrupting traffic.



Image by Motlabana Monnakgotla

EFF 832

Painting The Town Red

South African power utility Eskom cut electricity for a fourth straight day on Wednesday, as the department of public enterprises warned the struggling state-owned firm needed a cash injection by April to survive. 



Eskom, which supplies more than 90 percent of the power in Africa’s most industrialized economy but is laden with more than $30 billion of debt, is battling a shortage of capacity that threatens to derail government plans to lift the sluggish economy.



President Cyril Ramaphosa said last week that the government would support Eskom’s balance sheet but said details would be announced in a budget speech by the finance minister on Feb. 20.



The department of public enterprises, which oversees Eskom, said in a presentation to parliament that Eskom was technically insolvent and would “cease to exist” at the current trajectory by April, unless it gets the bailout. The minister, Pravin Gordhan, however, ruled out privatization of the utility.



The department also said Eskom was struggling to keep its mainly coal-fired plants running due to coal shortages and poor maintenance, with 40 percent of breakdowns a result of human error.



The cash-strapped company said it would cut 3,000 megawatts (MW) of power from the national grid from 0600 GMT on Wednesday, likely until 2100 GMT. This follows a similar cut on Tuesday and 4,000 MW on Monday in the worst power cuts seen in several years that drove the rand currency down on Monday. The rand was slightly firmer against the U.S. dollar on Wednesday.



Around a third of Eskom’s 45,000 MW capacity was offline on Tuesday.



The power cuts are prompting frustration among ordinary South Africans, with traffic gridlock in major cities during rush hours as traffic lights stop working and switched-off fans leave office workers sweating in the summer heat.



Business owners with no access to backup power sources have also been hit.



“We’re struggling,” said Eunice Mashaba, a manager of a textile shop north of Johannesburg who said he had to close the shop early on Tuesday because most customers do not carry cash but have to rely on debit or credit cards for payment.



Ramaphosa announced a plan last week to split Eskom into three separate entities in an effort to make it more efficient as he tries to lift the economy before an election in May, but faces opposition from powerful labor unions and from within his ruling African National Congress party. -Reuters



-Olivia Kumwenda-Mtambo and Wendell Roelf

View of electric pylons in Randburg, viewed from Republic Road, Johannesburg, Gauteng, South Africa.

South Africa’s Eskom Extends Power Cuts, Needs Bailout By April

The High Court case, in Pretoria on March 27, saw the full gamut of human emotions: anger; frustration and folly, followed by joy.
The latter emotion came from the long-suffering 27 independent power producers who won the case against an interdict to pave the way for the signing of the Power Purchase Agreements (PPAs) with the Department of Energy – the 20-year agreements that give them a chance to claw back $3.8 billion in investment.
The deal will add 2,300MW of green power to the estimated 40,000MW in installed capacity. Despite this, green power will make up 5% of South Africa’s power.
Outside the court, the thwarted National Union of Metalworkers of South Africa (Numsa) members and pressure group Transform SA weighed in with the anger and frustration coupled with a threat to block the streets in protest. As the union licked its wounds, the court poured on salt by ordering it to pay costs as it stuck the application from the roll.
“We got it from Eskom that if they introduce these renewables, they’ve done calculations on power station by power station on how many jobs will be lost. When we did this study last year it was found that 30,000 to 40,000 jobs are likely to be lost and there seems to be no interest about that,” says Numsa Secretary Irvin Jim.
“We are prepared to block the streets to achieve this.”
This claim despite the fact that Eskom will have to close down a number of its ageing and crumbling coal-fired power stations.
<a href="http://www.forbesafrica.com/technology/2017/10/30/road-green-future/" target="_blank" rel="noopener">READ MORE: On The Road To A Green Future</a>
“The South African population is being taken for a ride. Our fiscus is being looted because these companies, IPPs are only producing 5% power and taking 30% of Eskom’s profits,” says Transform SA’s Adil Chabeleng outside the court.
The mighty National Union of Mineworkers (NUM) – the biggest union in Africa with more than 300,000 members – agrees with Numsa that the unions don’t want private money generating the people’s electricity. They also feel that capitalists have benefited from public money ploughed into kick-starting green energy with preferential tariffs.
“We view this capitalist IPPs deal as a backdoor privatization of Eskom. The plan is to privatize 42% of Eskom by 2030 masquerading as the implementation of clean energy,” the NUM said in an angry statement.
“We are going to mobilize all our members and society to revolt against this planned madness called IPPs.”
Days after this fire and fury, Energy Minister Jeff Radebe shocked many by putting pen-to-paper for the PPAs to end the years of waiting.
The big problem now is to revive the dormant green power industry in South Africa.
“We have to resuscitate the industry to generate this power. Supply chains have to be rebuilt and manufacturing restarted. The whole supply chain has lain dormant for nearly three years,” says Brenda Martin, a board member of the South African Renewable Energy Council that represents most of the 27 IPPS.
Martin also refutes one of the claims of the unions that green power will see billions leaving South Africa and into the pockets of foreign investors. Numsa&#8217;s legal counsel Advocate Nazeer Cassim had argued in court that the signing of the IPPs could be viewed as a form of economic looting.
“Only 25% of this deal is owned by foreign investors and the rules of the game is that most of the money must stay in the country.”
Whatever the fall-out over the signing of the PPAs, just weeks before, this unsteady progress was a pipe dream after many months of dithering and a court case.
Picture this: multi-millionaire, suited and booted, investors leave air-conditioned airport lounges to fly thousands of miles to Africa to accept a government invitation to finally sign up for a return on their investment; only to arrive to, amid confusion, a court case, disappointment and a union that they’d never heard of, threatening to block the streets in protest against the deal. Confused? Most of them were.
“Excuse me,” a fresh-off-the-plane Italian investor, who looked like a clown lost in a circus, at the Department of Energy, asked one of the many young journalists at the press briefing, in Pretoria, on March 13.
“What is happening?”
The confused man from Milan was one of a number of foreign investors, from Spain to the United States, who flew in to sign PPA contracts. Investors expect it will take them a decade to claw back their money.
There was chaos before the investors landed that morning. Overnight, the militant Numsa – a union that appears to have forgotten that the Berlin wall came down – claimed it had won a late-night court interdict against the signing.
When it came to the signing later that day, in Pretoria, Energy Minister Radebe told investors that the courts had in fact not issued an interdict, as Numsa had claimed; it rather postponed the next hearing until March 27. You can understand the confusion of the man from Milan.
“It’s a banana republic,” chirped one of the South African investors in the wake of a day to forget in the course of renewable energy.
<a href="http://www.forbesafrica.com/woman/2014/02/01/shedding-light-renewable-energy/" target="_blank" rel="noopener">READ MORE: Shedding Light On Renewable Energy</a>
More inexplicable for investors was how these IPP contracts raised the ire of the unions almost overnight; there was hardly a peep from them in the years of government foot-dragging over signing them that has left many of the green power producers; at least 14 of the 27, according to industry, sources – on the brink of bankruptcy.
The coal-fired power stations of South Africa, built in the 1970s, are ramshackle and inefficient. Last year, the government said it was going to shut down the 3,000MW Kriel, 1,000MW Komati, 2,000MW Hendrina and the 1,600MW Camden power stations, all in Mpumalanga, anyway.
In any case, renewable energy generates a mere 5% of South Africa’s total power so the chances of green energy elbowing out coal, which produces nearly 80%, are unlikely in the extreme. It is more likely that South Africa’s coal-fired power stations will perish under the weight of repair bills and the cost of compliance with environmental regulations on account of the vast amount of acrid black smoke they belch into the African sky every year.
Other energy experts put down the government lethargy over signing the PPAs to ill-advised complacency. Low growth leading to low demand for electricity, plus a 500% increase in cost since 2007, has seen a cessation of power cuts in South Africa, for the time being.
Under the current energy scenario, South Africa will have more than 60GW of capacity by 2022, against a flagging demand of below 30GW, Ted Blom, a partner at Mining &amp; Energy Advisory, said. 
All in all, South Africa, which once dreamed of building the continent’s leading green power industry, creating thousands of jobs, has done quite a lot to destroy that dream. As well as the near three-year delay over signing the IPP contracts – the government has been penny-pinching, that is, trying to negotiate down tariffs with the argument that the country doesn’t really need energy right now.
What it means is that South African renewable energy producers are now looking across the continent for projects in favour of trusting the backed-up process in their own country. One of the unintended consequences of this whole controversy is likely to be that a score of African nations – who once lagged behind in renewable energy – could find themselves at the cutting edge of the industry thanks to South African technology and knowhow fostered by South African tax money and exported thanks to foot-dragging over contracts in Pretoria. Now, for hard-pressed South African taxpayers, that is an issue worth blocking the streets over.

Solar panels and windmills

Save Jobs Or Save Energy? The Dilemma Of Going Green

Just a few years into the cryptocurrency revolution, bitcoin mining is already eating up an estimated 20,000 gigawatt hours of electricity per year. That’s roughly 0.1% of global generation, on par with the power demand of Ireland. The primary culprits are bitcoin mining appliances like the Antminer S9, which is a computer processor that does nothing but endlessly crunch algorithms to lengthen the blockchain. An Antminer draws a load of 1.5 kilowatts — enough to power <a href="https://www.georgiapower.com/in-your-community/electric-safety/chart.cshtml" target="_blank" rel="noopener">two refrigerators and a flatscreen TV</a>. If you run an Antminer 24/7 for a year it will produce about 0.85 bitcoins, at a cost of about 15,000 kilowatt hours. Depending on your power prices it will cost anywhere from $600 (at 3 cents per Kwh) to $1,800 (at 9 cents per Kwh) to mine 1 coin. Even with bitcoin having plunged to $11,600 this morning, there’s still money to be made, assuming you can get your machines cheap enough. Walmart <a href="https://www.walmart.com/ip/Bitmain-Antminer-S9-14-TH-s-asic-Bitcoin-miner-Power-supply-included/724184035?wmlspartner=wlpa&amp;selectedSellerId=7506&amp;adid=22222222227136573873&amp;wl0=&amp;wl1=g&amp;wl2=c&amp;wl3=245332564990&amp;wl4=pla-402226074919&amp;wl5=9027582&amp;wl6=&amp;wl7=&amp;wl8=&amp;wl9=pla&amp;wl10=115780710&amp;wl11=online&amp;wl12=724184035&amp;wl13=&amp;veh=sem" target="_blank" rel="noopener">sells</a> the Antminer s9 for $8,200.
But what happens if the bitcoin bubble just keeps expanding? Some <a href="https://www.weforum.org/agenda/2017/12/bitcoin-consume-more-power-than-world-2020/" target="_blank" rel="noopener">naysayers</a> worry that bitcoin mining could eat up all the <a href="https://www.vox.com/energy-and-environment/2017/12/2/16724786/bitcoin-mining-energy-electricity" target="_blank" rel="noopener">world’s</a> power generation <a href="http://www.newsweek.com/bitcoin-mining-track-consume-worlds-energy-2020-744036" target="_blank" rel="noopener">by 2020</a>. Is it a realistic concern? No.
Analysts Michael Weinstein, Khanh Nguyen and their team at Credit Suisse took a look at the issue, and in a research note out today they conclude that fears of cryptocurrencies overwhelming the power grid are overblown. Start by comparing bitcoin’s 20,000 gigawatt hours per year with the 4.3 million Gwh used in the U.S. last year and 6 million by China. The analysts figured that if the price of bitcoin rose to $50,000, miners would find it economic to boost their efforts such that they would consume more than 350,000 gigawatt hours, still less than 2% of world power capacity. The team also calculated the bitcoin price that would be needed to incentivize miners to gobble up all the world’s generation capacity: $1.1 million per coin.
But that’s all assuming existing technology. As cryptocurrencies evolve, they will become more energy efficient. The proof-of-work algorithms run by bitcoin miners are needlessly complex. New coins have simpler algorithms. Ethereum is even shifting from a proof-of-work system to a more easily processed proof-of-stake system.
<a href="http://www.forbesafrica.com/cover-story/2017/09/04/bitcoin-blockchain-billions/" target="_blank" rel="noopener">READ MORE: Bitcoin, Blockchain And Billions</a>
Crypto-mining will enjoy the same economies of scale of web servers. From 2000 to 2010 the power consumed by data centers surged from 20,000 gigawatt hours to about 70,000 Gwh. At that rate it wasn’t going to take long for the growth of the internet to outstrip human ability to keep the lights on. Data centers evolved to meet the need, both growing in size and scale, as well as energy efficiency. Since 2010 server farm power demand has barely grown, despite the number of installed servers growing 6-fold. <a href="https://eta.lbl.gov/publications/united-states-data-center-energy" target="_blank" rel="noopener">According to</a> scientists at Lawrence Berkeley Lab, the industry is on track to improve energy efficiency 45% by 2020 with the likes of Google, Amazon and Facebook leading the charge.
Fears of rampant energy usage caused by rampant new marijuana cultivation were similarly half-baked. Utility companies in Colorado, California, Oregon and Washington have seen less than a 2% uptick in power demand linked to pot grows, according to the Credit Suisse team. Pacific Gas &amp; Electric even offers discount power pricing for growers — who have LED bulb technology to thank for keeping their lighting bills low.
There’s also the substitution effect. Crypto-blockchain-based payment systems will eventually replace our hack-prone credit card institutions, which themselves are <a href="http://www.datacenterknowledge.com/asia-pacific/visa-plans-its-first-non-us-data-centers-london-and-singapore" target="_blank" rel="noopener">massive</a> data centers (Visa even has one with a <a href="https://usatoday30.usatoday.com/tech/news/story/2012-03-25/visa-data-center/53774904/1" target="_blank" rel="noopener">moat</a>). And somewhere out on the margin, cryptocurrencies are likely to reduce demand for other expensive-to-mine assets, like gold, which according to S&amp;P Global has an all-in cash cost of about <a href="https://marketintelligence.spglobal.com/our-thinking/ideas/gold-mining-companies-hold-operating-costs" target="_blank" rel="noopener">$900 per ounce</a>.
<a href="http://www.forbesafrica.com/investment-guide/2017/12/11/actually-okay-completely-ignore-bitcoins-1400-rally/" target="_blank" rel="noopener">READ MORE: It&#8217;s Actually Okay To Ignore Bitcoin&#8217;s 1,400% Rally</a>
In the long run, says Credit Suisse, the breakthrough far more likely to rile world energy markets is the electric vehicle. If, by 2040, EVs grab a third of new-car market share, the world could require more than 280 gigawatts of additional power generation capacity — or somewhere in the vicinity of 2.4 million gigawatt hours. But again, that’s figuring on current technology. After <a href="http://jes.ecsdl.org/content/164/1/A5019.full" target="_blank" rel="noopener">25 years of improvements</a>, lithium ion batteries are going to keep getting better.
Technology has a way of outwitting the unbelievers. Just a few months ago Jamie Dimon, CEO of JPMorgan, called bitcoin “<a href="https://www.cnbc.com/2017/10/13/jamie-dimon-says-people-who-buy-bitcoin-are-stupid.html" target="_blank" rel="noopener">stupid</a>” and a “fraud.” Last week he said he regretted those comments, saying, “<a href="http://www.foxbusiness.com/markets/2018/01/09/exclusive-jpmorgan-chase-chairman-ceo-jamie-dimon-regrets-saying-bitcoin-is-fraud-but-still-isnt-interested-in-it.html" target="_blank" rel="noopener">The blockchain is real</a>.” &#8211; Written by <a href="https://www.forbes.com/sites/christopherhelman/" target="_blank" rel="noopener" data-ga-track="contrib block byline">Christopher Helman</a>, FORBES STAFF

Bitcoin Mining Uses As Much Power As Ireland. Here’s Why That’s Not A Problem

Across the globe, more nuclear power units are under construction today than at any other time in the last 25 years. This is happening despite the 2011 crisis in Japan at Fukushima. It is important to note the Fukushima crisis and resulting problems was not a result of a nuclear disaster, but rather a tsunami that laid waste to large parts of Japan and killed around 20,000 people.
At the start of 2015 there were 436 operating nuclear reactors across the globe. By year-end this had increased to 439, despite the closure of seven units during the year. The countries driving nuclear construction are largely in Asia, with China, at last count, building 30 new reactors to add to their fleet.
In South Africa, it’s clear that the government is intent on pressing ahead with a new nuclear build program. The Integrated Resource Plan calls for 9,600MW of nuclear power and this still seems to be the target for the new build. One reason seemingly being that since nuclear is an expensive and complicated industry; it would simply be more cost effective over the long term to invest in a fleet of reactors that can be supported by an underlying industry. If this should transpire, it will certainly lead to a boom in jobs across many sectors of industry.
The environment is another reason nuclear power is punted as an option for South Africa. At the United Nations Climate Change Conference in December, countries reached an agreement to hold the average global temperature increases to less than 2 degrees Celsius, compared to preindustrial levels. The targets agreed upon will require significant reductions in the global greenhouse gas emissions and one of the major areas targeted for reduction of carbon dioxide outputs would be energy generation. The bulk of the globe’s electricity is still generated by fossil fuels, with nuclear power supplying roughly 10% of global electricity. The use of nuclear power is recognized as being a means to achieve climate change targets.
Another serious question around South Africa’s energy future is the planned decommissioning of old power plants. By 2030, Eskom, by law, must close down 14,800MW of existing capacity, while Eskom’s new mega build projects will only add 10,932MW over the same period. These older plants are currently supplying a large part of South Africa’s baseload electricity. The country can ill afford to lose such a big part of its capacity and there is still no clear plan as to what will replace this baseload capacity. The role of renewables is limited; the availability of power output from renewable energy is still not comparable to that of fossil fuel or nuclear plants. Add into the mix the environmental considerations and there is only one option to replace old baseload with new baseload – nuclear.
The major constraint to a new nuclear build in South Africa is funding. Accurate estimates of what a 9,600MW fleet could cost are largely unavailable; they range between $45.4 billion and $68 billion. The only thing we know for sure is that is going to be very expensive. There are other concerns over safety, waste and the ability to run a corruption free and timeous build process.
However, there are also some benefits. The country cannot ignore the environmental issues and the need for a reliable baseload power system that can allow the economy to grow. The South African economy may be moving away from mining but there is no need to ignore the potential in the future of mining, as well as in added beneficiation. Reaching this potential would require a lot of electricity and of course, the more the economy grows, the greater the need for electricity.
Where will the first new plant be built? The Eastern Cape province still seems the most likely area. When will the first new reactor be built? The current economic downturn has given the country some breathing room and the pressure is off for now, but there can be little doubt that new construction could start within the next two years. Following that, the full fleet of 9,600MW could follow over the following 20 years. In addition, given government’s appetite for nuclear power, I would not be surprised if South Africa sees more than 9,600MW of nuclear power by 2050.
Is that a good thing? Time will tell.
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James-Brent Styan authored a book on the energy crisis called Blackout, The Eskom Crisis. It was published in 2015. He writes in his personal capacity.

The Good, Bad…  And expensive

Two boreholes, drilled deep into the Karoo wilderness, have thrown fracking optimism into the garbage can. The core samples go by the mundane names of KZF-1 and KWV. They took weeks to drill and cost $2 million. Between them, they have thrown into doubt the dream of unearthing enough energy to power Africa.
The discovery was made by teams of researchers, from the Karoo Research Initiative (KARIN), who spent more than a year studying the vast wilderness in South Africa.
“The more we see, the more questionable the entire thing becomes, whether it will be profitable or not,” says Wlady Altermann, Head of Geology at the University of Pretoria, who inspected the core samples.
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Geologists found there is not as much shale gas in the Karoo as the government and energy companies claim. In 2009, Econometrix, South Africa’s largest independent macroeconomic consulting firm, believed there was 485 trillion cubic feet (tcf) of natural gas – the government and energy companies took this as gospel; it supported the case to open up the Karoo.
In May, research by Selwyn Adams, Principal Geologist at Petroleum Agency South Africa, which licenses onshore and offshore gas exploration, says their best model was 183 tcf.
Now, an even more lean estimate has emerged from Doug Cole, Senior Specialist Scientist at the Council for Geoscience (CGS), a parastatal mandated to research South Africa’s geology. He says there could be as little as 32 tcf, a fraction of the bigger amount that caused all the excitement.
By comaprison, 72 tcf is in Mozambique’s Offshore Area 1, one of the most important natural gas accumulations discovered in the last 20 years. The discovery, made 200 kilometers offshore in the Rovuma basin, alone is enough to add $39 billion per year to Mozambique’s Gross Domestic Product (GDP) by 2035.
“Initially I think they just took the volume of the base and didn’t consider the dolerites. It was obviously much too much,” says Cole.
KARIN was merely studying the geology of the Karoo and stumbled on the evidence.
“We have not seen a rock yet that would produce enough organic matter to produce shale gas in large amounts,” says Altermann.
“The conclusion of KARIN’s boreholes throws doubt into the original claim of the fifth largest reservoir of shale gas. From these two boreholes, the presence of shale gas is questionable, but this does not mean these results will be the same on other sites.”
The dolerites found could make it even more expensive to get any shale gas out. Unlike the shale gas boomtowns of the United States, the Karoo is littered with these dolerites – high temperature rocks – which burn off gas before it can be fracked.
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These discoveries are likely to strengthen the case against fracking by farmers, who fear it could pollute water. Hydraulic fracturing, or fracking, uses millions of liters of water with a 1% mix of chemicals, to fracture the shale to release natural gas at depths of 1,500 meters. This could contaminate borehole water used by the farmers.
Unlocking the mystery of the risk to underground aquifers is Kate Robey, a 30-year-old hydrogeologist at the CGS.
“In the 1970s, a South African-based parastatal called Soekor was mandated to find oil. Shale wasn’t even known then. But, during those explorations they did find gas. It is based on this information from the 1970s that we think there may be shale now&#8230; It is old data that wasn’t even looking for shale.”
There were questions when Robey, who was on site when KARIN was drilling KZF-1, hit fresh water at 560 meters below the surface. They didn’t expect it.
“The Tankwa site, which went 560 meters, hit artesian water so fresh I couldn’t believe the probes giving me the results. I had to drink it myself. We never expected that. We expected the water to be more salty. It may even be that these deep aquifers are fresher than the shallow ones,” says Robey.
Although Robey says this is an anomaly, finding fresh water in Tankwa throws up more questions about fracking.
“Due to the sparse data we have on deep groundwater in South Africa (based on the Soekor holes) we expected groundwater at depths greater than 500 meters to be saline, which could be concerning if shale gas activities were to continue in the Karoo at great depths. If not properly managed or monitored, and there is interaction between the saline groundwater and the shallow aquifers in the Karoo, this could result in irreversible damage of the water.”
“However, on the converse, now that we found that there was fresh water at such depths, a lot more interesting questions and research needs to be undertaken. Such as can we use this hot water for geothermal energy or even as a future water resource?”
This is why Robey will be digging deeper in the heart of the so-called ‘sweet spot for fracking’ in the Karoo, near Beaufort West.
“We need to get these properties because if ever, one day, fracking does take place, it will prove if there is any pollution from the deep groundwater into the shallow.”
It could take up to 15 years to collect the data. In the researchers favor is the current oil price. The drop in commodity prices has given a vital lifeline for researchers to gather the data before legislation goes through. It needs to be above $70 a barrel to turn a profit from fracking; at the time of writing it is $47.17.
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Will fracking mean jobs?
“Let’s get rid of the rumors – fracking won’t benefit the lower class. The actual production through fracking would require high-end technology and expertise, which up to now, is not available in the country,” says Altermann.
“You don’t need people with shovels and hammers. It’s high technology stuff, skilled people will be flown in.”
A fracking future that seems far away.

The Fracking Future Fades

Most of Africa is currently engulfed in an energy emergency.
For a continent blessed with some of the largest power generating potential in the world, it’s an ironic tragedy, at par with any epidemic Africans have ever experienced. As things stand, the prospects for prosperity are bleak.
This has been Africa’s sour story for too long. Without power, social and intellectual fecundity and creativity is hobbled; innovation, doomed. From Cape Town through Calabar to Casablanca and Cairo, failed power projects litter the land. Africa now reportedly generates less power than many European nations.
In view of the contending economic, ecological and social priorities, Africa’s humungous power deficit must now be viewed as a crisis, and an opportunity. A crisis in desperate need of modern energy solutions, fresh investments and political will. This variegated mindset is essential if Africa is to find its way out of the dark maze.
The use of off-grid, renewable technologies, for instance, will attenuate some of the darkness, create opportunities to increase agricultural productivity, improve Africa’s resilience to climate change, and contribute to long-term reductions in dangerous carbon emissions across the African landscape.
At stake is the global relevance, social progress and economic productivity of Africa’s nearly 1 billion people. Universal access to power is the goal. But how do you measure the compounded return on development initiatives brought about by lighting up an entire city or village? Experts say an estimated $850 billion will be required to achieve universal power access for Africa by 2030.
Depending on which book you’re reading, between 1 billion and 1.5 billion people lack access to modern forms of electricity worldwide, and three billion cook on smoky, soot-stained stoves and outdoor fires. Chances are (no marks for guessing) many of these folks are in Africa.
Analysts at McKinsey &amp; Co. say Africa has 13% of the world’s population, but 48% of the share of the global population without electricity. The only other region with a similar imbalance is South Asia, with 23% of the world’s population and 34% of the people without access to electricity.
Only seven countries in Africa – Cameroon, Côte d’Ivoire, Gabon, Ghana, Namibia, Senegal and South Africa – have electricity access rates exceeding 50%.
The International Energy Agency (IEA) says 55% of Nigerians, 70% of Ivorians, 76% of Ethiopians and 85% of residents of the Democratic Republic of Congo do not have access to electricity. A 2015 report by the Africa Progress Panel, People, Power, Planet, confirms this dark reality: 621 million Africans have no access to electricity. That’s two out of every three Africans.
The report warns that global demand for modern energy is set to surge, fueled by economic growth, demographic change and urbanization. “As the costs of low-carbon energy fall, Africa could leapfrog into a new era of power generation. Utility reforms, new technologies and new business models could be as transformative in energy as the mobile phone has been in telecommunications.”
The World Bank says Africa’s power consumption, at 124 kilowatt-hours per capita per year and falling, is only a tenth of that found elsewhere in the developing world, barely enough to power one 100-watt light bulb per person for three hours a day.
Thankfully, Africa does not suffer from a dearth of energy resources. Kenya is currently ranked the seventh-highest producer of geothermal power globally, as the second phase of the Olkaria geothermal plant comes on stream.
South Africa’s Medupi power station, the fourth largest coal plant in the southern hemisphere, recently received a $2.1 billion loan from the African Development Bank (AfDB).
Morocco, Africa’s poster child for clean energy, spends over $3 billion annually on fuel and electricity imports. The country aims to generate 42% of its energy from renewable sources by 2020.
Most multinationals and manufacturing firms in Nigeria disengaged from the national grid years ago. Investing in captive power plants to remain competitive, they now generate about 1,600MW of power off-grid.
Power firms, like Cummins Incorporated and Clarke Energy, working with General Electirc and local players like CET Power, are mostly behind these efforts, designing, constructing, operating as well as maintaining gas-fueled power plants across the country.
Power proposals for Africa abound. We have the Britain’s Energy Africa, United States President Barack Obama’s Power Africa and the AfDB’s New Deal on Energy.
We now need to switch on these plans.

Power, Pain  And Progress

Building nuclear power stations in South Africa could benefit other industries that are in dire need of a leg-up.
South Africa’s cabinet has kicked off the Nuclear New Build Programme (NNBP) to get an initial 9,600MW of nuclear power which, according to President Jacob Zuma and Finance Minster Pravin Gordhan, “will be built on a scale and at a rate the country can afford”.
The cost of obtaining this much power will be around $40 billion to $50 billion over 15 years.
Contrary to the view of naysayers, the nuclear power lifetime cost is lower than most technologies. It is also the leading global baseload renewable energy source, topped up with hydro, clean coal independent power producers (IPPs), wind and solar.
The Department of Energy’s strategy has been to engage with nuclear vendor countries, and not only nuclear power plant (NPP) original equipment manufacturers, as they did in the failed 2007 process. Agreements have now been signed with five nuclear vendor countries – France, Russia, South Korea, China and USA/Japan.
These countries are able to supply modern pressurized water reactor (PWR) NPP technology, funding, construction and localization development strategies. Some offer fuel supply and fuel waste management support. These partnerships will last 100 years if you consider the full cradle-to-grave lifecycle of the modern NPP.
Government intends following a transparent procurement process, which will be placed into the IPP Office. This office is currently responsible for the successful renewable energy, baseload coal, and gas to power IPP programs.
“Only once nuclear vendors had entered their bids would South Africa have an understanding of what are the different cost levels [and] what type of technology is available… So it’s going to be a year, or two, or more before we can definitely say how long, how much and over what period of time we are going to be managing this program,” says Gordhan.
The principle vendor countries, and their own domestic technology companies, will look to share risk through international alliances and to embed a strong local content into their offering. This will provide support and funding for broad-based black economic empowerment (BBBEE), the construction and manufacturing sectors, and black industrialists.
Such Sino-Franco partnerships have been successful in building the Taishan NPP in China and the Hinkley Point C NPP in Britain, so watch this space.
South Africa’s nuclear readiness and localisation is an important issue for the initial 9600MW and could range anywhere from 20% to 40%, depending on how advanced the country’s readiness strategy is and its intentions for developing a flourishing nuclear knowledge economy.
South Africa has a proud heritage in power generation construction across all the primary energy technologies, but is now coming off a 2010 construction boom, with a big coal build now rapidly tailing off. The country’s embattled construction sector will be challenged to prepare for a nuclear build program without a well-thought-out and structured national strategy. We need to keep the momentum gained for the foreseeable future.
An early dialogue between the engineering and construction fraternity, the manufacturing sector, government and labor is therefore crucial to devise an incorporated plan for the NNBP. This plan will need to give South Africa about five years to ready itself to ramp-up into the investment and localization of the NNBP and will have to be sustained for at least the following 10 years.
The potential is for over 20,000 construction jobs to be created and a similar amount in the manufacturing and supply to the NNBP. Without a plan, the opportunity will be lost to foreign jobs and higher imported content for the NNBP.
Many industry players could be activated when the NNBP is announced. Supporting infrastructures will be a great stimulus for the local communities near the selected NNBP sites in the Eastern and Western Cape provinces. Currently the local talent pool is small. Group Five and Lesedi Nuclear Services are the only private sector companies currently fully active in the nuclear industry.
In the public sector, the South African Nuclear Energy Corporation (NECSA), Denel, Eskom and the National Nuclear Regulator (NNR) will have major roles in the establishment of the NNBP and in the supply to and execution of the projects.

Can Nuclear Power Up Other Industries?

As international investors became more familiar with the continent, international listings and debt offerings by African companies increased as the need for capital to power investments intensified. Record low interest rates globally created an issuer-friendly debt market over the past five years, while foreign equity markets also made it easy for African companies to list. By 2013, over 100 sub-Saharan focused entities were represented on the London Stock Exchange (LSE), with a total market capitalization of $70 billion which accounted for roughly 5% of Africa’s total market capitalization.
This year, the much anticipated listing of Dangote Cement on the LSE is expected to be the latest African-based issuer. As a result of this trend, many emerging market equity players have come to prefer gaining exposure to African companies via developed world exchanges as opposed to investing via the issuer’s local bourse.
Nonetheless, due to the increase in interest rates in the United States (US) and subsequent weakening of local currencies relative to the US dollar and other major funding currencies, this trend is likely to dissipate this year as repayment of foreign currency denominated bonds has become more expensive. Moreover, the implosion of developed equity markets means investor appetite for international listings may not be sufficient. For this reason, since raising capital is a continuous process, this could the perfect opportunity for Africa’s capital markets to rise up and lure more African companies from the grip of international bourses. London has remained a leading destination for African companies listing abroad for over 60 years, according to LSE. Needless to say, work is clearly cut out for the more than 23 African stock exchanges to improve their platforms to succeed in this.
Perhaps the place to start is solving the challenges of illiquidity, high trading costs and small-sized markets. In my view, the last two require the integration of regional stock exchanges, such as what has been done successfully by the BRVM in West Africa and what the East African Community (EAC) is seeking to do. In this regard, the Johannesburg Stock Exchange (JSE) could consider relaunching the Africa Board, implementing the lessons learned from the initial failed attempt in 2009. Considering the economic size of many African nations, it’ll be very expensive to operate such an exchange.
On illiquidity, there will be need for more investor education and more listings for change to occur. Surely, something is not right when the second biggest equity market in sub-Saharan Africa, Nigeria’s stock market, has a daily turnover of less than $30 million. The Nairobi Securities Exchange has 61 listings, but just 10 of those constitute roughly 90% of its annual markets liquidity. Further progress would also require African countries to harmonize their trading laws and accounting standards, set up convertible currencies and establish free trade among members.
Despite this, African capital markets have been growing and gaining recognition over the years. At the end of 2015, total market capitalisation stood at $1 trillion, up from $113 billion in 1992. African equities are now included in emerging frontier indices and Africa-focused benchmarks indices, such as the Russell Frontier Index (RFI), MSCI Emerging Markets Africa (excluding South Africa) Index, S&amp;P Africa Frontier, S&amp;P Pan Africa, and FTSE ASEA Pan Africa Index. According to PwC’s recent 2015 Africa Capital Markets Watch, over the past five years alone, there were more than 100 initial public offers (IPOs) and 336 further offers (FOs), raising a total of $41.3 billion. Furthermore, African equity markets have seen a surge in Africa-focused equity funds, such as JPMorgan’s Africa Equity Fund and the Old Mutual African Frontiers Fund, which invest directly in equity and equity-related securities of companies domiciled or listed on an African exchange.
Given Africa’s economic prospects and volatility in global capital markets, now is the time for Africa to establish its exchanges in order to offer its home-grown enterprises the services that they need, while also tapping into the growing portfolio allocations toward the continent. For Africa to emerge as an important player in the world of capital markets, a well-established capital market is necessary to provide a better alternative to its well-known rivals.
They say a journey of thousand miles start with a step – thankfully Africa has already made several steps and is closer to its destination.

On The Right Path

Ferrari, Lamborghini, Maserati. There is an exciting ring to those names, but that ring comes at a price.
And you can expect to forfeit a dowry of more than $200,000 to marry into the top-end of these Italian families.
But there is a classy cousin with style, performance and the badge that turns heads… coming in at around a third of the asking price – a shade over $80,000.
The Maserati Ghibli is offering Italian supercar style and status in the luxury executive car segment after an absence of nearly two decades.
Clearly in the sights of the new entry-level Maserati are the Mercedes Benz E-Class, BMW’s 5 Series, Audi’s A6, the Jaguar XF and a host of other sporty saloons which have a slightly leaner price tag.
If the name Ghibli seems familiar, it was originally a V8 Grand Tourer released in 1967 and then a four-seater coupe in 1992.
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It seems that Maserati, now nestling under the massive Fiat Chrysler empire, decided a few years ago to do something special for its 100th birthday and build a scaled-down Quattroporte limo for the moderately well heeled.
And, like the wind it is named after, the Ghibli has blown apart all the tired sales figures for the brand.
In automotive terms it doesn’t really make sense, especially in recent years of conservative global growth, and at times decline.
It’s hard to comprehend that Maserati sold a mere 6,200 units in 2012 and almost seven times that number last year – with the Ghibli clearly leading the charge for growth.
And that’s before the next major model release, the Levante luxury SUV arrives to cross swords with the Porsche Cayenne and Range Rover Sport.
Heady days for the assembly line at the new Giovanni Agnelli plant in Turin and also some extra shifts for Ferrari, in Modena, crafting the Maserati-designed engines.
It’s a belated tribute to the Maserati brothers, Alfieri, Bindo, Carlo, Mario, Ettore and Ernesto, who were all involved with automobiles from the beginning of the 20th century.
It was all about racing in the formative years. Then in 1926 the production of two-liter Grand Prix cars for Diatto was suspended and the first Maserati was engineered bearing the now famous marque.
When you see the Ghibli in the flesh you may want to give Marco Tencone, head of design since 2009, a pat on the back.
It may be called an entry level Maserati, but it lines up against the big guns on the showroom floor without any reflection of the smaller dent in your bank balance.
Its eye-catching, flowing lines which radiate from the iconic, but rather daunting, grille hold your breath all the way to the menacing exhausts without ending in a disappointing Panamera-like rear.
What I like about the interior is the classic simplicity. Essentialism rules in this design, where no controls are there for the sake of fashion, the dials are stark and clear and the multimedia screen and system is superbly logical.
But don’t mistake a lack of frills with a lack of exclusivity and craftsmanship.
“The fact is that, with Maserati, you bespoke your car. The combinations are endless and it’s not a luxury car unless you can personalize and tailor it for the specific customer,” says Rens Rademeyer, General Manager at Maserati Johannesburg.
“The focus is on the quality of workmanship and materials.”
To be honest, I was expecting a rather sedate drive in the Ghibli S. But the acceleration is rampant and at times it’s difficult not to wheel spin at the lights.
All the Ghibli models, including the ground-breaking diesel, are powered by V6 3-liter twin turbo engines. The five-second S gets that extra boost thanks to some fine engine mapping and components.
On the negative side, there was a perceptive turbo lag which seemed to be minimized in manual and the rather sturdy oversized paddles are a lot more fun to communicate directly with the eight-speed ZF transmission.
That’s possibly why the gear selector seemed a tad finicky and seemed to stray into manual if not closely monitored.
The ride is superbly smooth and the Ghibli glides over the plethora of city speed humps without the neck-jarring suspension of some competitors.
And, on a rather personal level, my ungainly two-meter frame felt ever-so snuggly cosseted on those painstakingly padded and stitched seats.
Even if you’re not behind the wheel of a Quattroporte, there is a distinct brand cachet. Without being too esoteric, beyond the nuts and bolts of manufacture, there is an element of prestige riding behind the trident badge. You notice it in the attention of a petrol pump attendant or even the nod of acknowledgement from a fellow motorist at the lights.
But here’s the rub. Even with projections of a ceiling of 75,000 models (across the range), Maserati will battle to keep up with the fast developing technology of the major German luxury trio.
To put it blatantly, you may look like a million dollars in your Ghibli but you will be missing many standard features of the mass produced rivals.
That is the trade-off.
“A lot of these so-called features are gimmicks,” says Rademeyer. “We are giving our customers a pure driving experience, we are not selling smartphones.”
Rademeyer extends the same personal service to the new showroom, in the plush Johannesburg suburb of Bryanston, where he pilots the Italian coffee machine to turn out a pretty mean cappuccino. All the staff have to train as baristas.
But maybe they should offer customers a Foster’s lager after hours. That’s because the franchise holders for Maserati in South Africa are now European Automotive Imports (EAI), who are aiming to build on their success with the brand in Australia.
“Our goal is to transform Maserati’s position in the South African market to offer a new benchmark for exclusivity and customer service,” says EAI Chief Operating Officer, Glen Sealey.
“We have been very successful in Australia and our appointment in South Africa is an outstanding vote of confidence and a clear acknowledgement that we have the people and expertise to succeed.”
What this means is that Maserati is no longer under the wing of Ferrari and is flying solo.
Maserati re-enters South Africa with its complete model offering of the Quattroporte, GranTurismo and GranCabrio ranges.
A Maserati dealership has just opened in Cape Town, on the foreshore near the International Convention Centre, and plans are underway to find a partner in Durban.
Perhaps the critical element of the expansion is to ensure that the resale values stabilize and servicing standards are up to scratch.
“Globally, the brand is ramping up all the dealer management and customer relationship systems,” says Rademeyer.
“But the systems are there to help us manage relationships with our customers, so we don’t depend on automation. But it helps us to manage the personal interaction with our customers. We have volume aspirations but will never be a brand-considered mass-produced [car].”
It’s a swaying tightrope that Maserati have to walk between the prestige of the trident badge and bidding for a bigger slice of the market segment.
As the Italians say to wish good luck: in bocca al lupo!

Italian Beauty Back In Africa

As chair of the African Union (AU) Commission, Nkosazana Dlamini-Zuma is based in Addis Ababa, Ethiopia, it would seem, far from the politics of her home country South Africa.
But it is now, in recent months, perhaps more than ever before, that her name is ricocheting in the corridors of power. Whilst political observers say she is coming to South Africa more often addressing high-profile meetings, the speculation is if she will be South Africa’s next president in 2017.
Will she be? If she does, it will make her South Africa’s first female president, which will be a political harbinger for the women’s movement.
We posed the question to the sexagenarian and anti-apartheid activist in June 2015 in Johannesburg, a day after the 25th Assembly of African Union Heads of State and Government around the theme ‘Women’s empowerment and development towards Agenda 2063’.
“That is not dependent on me,” Dlamini-Zuma had replied with a gentle laugh.
“At the moment, I am working at the AU, and that’s where my efforts should be. Who becomes the president of South Africa is a decision of whichever party wins, it will be the decision of the ruling party. And I have to do my best where I am. If you work for it, maybe it will happen. It is the decision of South Africans, but not my decision.”
A medical doctor, Dlamini-Zuma had been minister of health during Nelson Mandela’s presidency, foreign minister in the Thabo Mbeki government, and home affairs minister in the Jacob Zuma government before becoming the first woman to take on the top job at the AU in 2012.
Dlamini-Zuma’s mandate for now is clear – a united and strong Africa.
The greater financial inclusion of women on the continent, especially in agribusiness, is a subject close to her heart.
“The women on this continent are very unique in many ways. They really are the drivers of communities, of families, they are the curators of our culture, they really are the backbone of our social security as they take care of the elderly and the sick. But they also just make sure the land is tilled, there is food on the table for the children. But we need to empower them to do a lot more.”
Binding a large, heterogeneous continent with similarities rather than differences is challenging, but Dlamini-Zuma stridently believes in the pan-African dream, and the power of the youth to shape Africa.
“What is common is that we are all driven by a pan-African approach, which looks at solidarity amongst Africans, unity amongst Africans, and so I try and use what is common, what can drive all of us to prosperity and peace. And also working around the issues of women, as they are common on the continent and across the globe, and working with youth, which is also a critical part of what we do.”
In September 2015, Dlamini-Zuma received the Gülen Peace Award from the Turquoise Harmony Institute. Previous winners include Graça Machel and Archbishop Desmond Tutu.
One of her achievements at the AU, she says, has been bringing together Agenda 2063, a development framework and vision for Africa.
“The second thing we have been able to achieve is to get the continent to realize it has to fund its own programs…We want to make sure we are at the forefront and the world should work with us, support us, invest in Africa, but we have to invest in Africa ourselves.”
The management of diversity on the continent is another key focus. And more women in politics, as positive role models, driving the agenda for change. Whether or not Dlamini-Zuma becomes South Africa’s next president, she is certainly only a step away from proving it is possible.

The Pan-African

Will the announced nuclear program energize South Africa’s manufacturing and construction?
My background is power engineering. Building power plants across Africa generates as many stories as they do megawatts. It is ironic that, in Africa’s most electrified economy, there are tales of powerless people and an economy running out of juice.
Eskom, South Africa’s national power generator, is cooking with gas (turbines) – at the cost of around $78 million a month – while grinding away at the late completion of the new 9,000MW Kusile and Medupi coal power plants. Medupi’s first 800MW unit is generating power and will be on commercial load in September, with up to 1,600MW coming onto the grid each year for the next five years.
Keep your gas cylinders full and your camping lights charged – there’s more to this story!
South Africa has a 40GW-headache to cure in the next 20 years. The first 10GW is merely to match current demand. Generation capacity is 40GW with only about 30GW available due to the UCLF (unplanned capacity loss factor) being high. The national demand is over 40GW as mines and smelters have shut down to help Eskom. Medupi and Kusile will merely tick this box.
The second 10GW is needed to replace the old coal plants before 2025. They have been run hard well beyond their time. The third 10GW is needed to attract investment for growth and the fourth 10GW is for reserve capacity to allow for maintenance.
Coal may be easier and cheaper, but it’s dirty stuff and our economy has to be environmentally attractive to foreign investment. Few investors will stump up if it will worsen their carbon footprint.
So, 40GW in the next 20 years! Simply put, double Eskom. It has to be greener than ever before too – no dirty coal. That means nuclear topped up with clean coal IPPs. Wind and solar may be very sexy but they don’t deliver the big base load power that we need.
Like it or not, nuclear is the leading renewable energy source and South Africa is in play on the global nuclear stage to procure 9,600MW of nuclear power.
Contrary to the naysayers, nuclear energy’s lifetime cost is lower than most technologies, it’s expensive at the start, but cheaper to run.
South Africa’s nuclear regulatory body has defined that only the safest technology will meet the environmental and safety specifications for any new build program.
Russia, France and China are likely frontrunners, but who has the better and safest kit and who can offer a compelling financial deal? That’s where technology, money, politics and common sense meet in a witches brew.
The International Atomic Energy Authority (IAEA) Integrated Nuclear Infrastructure Review (INIR) sets the readiness criteria for building nuclear plants. A nuclear power plant is split into three main sections: The Nuclear Island, The Conventional Island (Turbine) and the Balance of Plant. South Africa is ready to manufacture and construct on the last two sections, which are similar to the local content of Medupi and Kusile, with some nuclear safety alignment.
The nuclear codes and quality standards take a quantum leap in the Nuclear Island and that is where the nuclear certified contractors like Group Five, Lesedi Nuclear Services and the South African Nuclear Energy Corporation (NECSA) are qualified. The country’s industry will have to partner with the successful vendors to hone those skills, train a workforce and learn from the build program in Europe, China and Russia.
There’s a buzz again. Nuclear vendors expected a request for proposals in August with a preferred Nuclear Vendor Country announced by March. Next year will see tendering for the local manufacturing and construction sector, with contracts signed in 2017 and construction starting in 2018.
The capital expenditure for 9,600MW will be approximately $40 to $50 billion, plus government costs and interest on capital. All this leads to trillions being spent over 15 years. That’s a big number that will reignite local industry and a knowledge economy after the last seven years of power cut misery.
Could we “boom” again?
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Additional reporting from Des Muller, head of Group Five Nuclear Construction Services.

double or quit?

Tucked inside Kenya’s Rift Valley are the Olkaria geothermal fields. A mix of a national park (Hell’s Gate National Park) and steam wells, the fields are powering Kenya’s growing electricity demands.
The first steam wells, also known as geothermal wells, in Kenya were built more than 30 years ago. Then, there was little regard for geothermal power – energy generated from natural steam from the earth. It was regarded as one of the many expensive ventures by the government.
Today, the focus on renewable energy has never been greater in Kenya. Several billionaires attended the Global Entrepreneurship Summit in July in Nairobi to explore investing in renewable energy in the East African nation.
“Investors in this initiative have chosen Kenya because the government is ready to listen to ideas and help implement them,” said Sir Richard Branson who led a delegation at the summit.
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Energy demands in Kenya are growing. This is largely due to renewed investor confidence in the country as well as the government’s improving retail consumer connectivity. This has seen the government work on an ambitious strategy to generate 5,000 megawatts (MW) by 2018.
Out of this, renewable energy is expected to take center stage as hydroelectric and fossil fuel generation are cut significantly.
In 2006, Kenya created the Geothermal Development Company to speed up the development of geothermal resources. The firm took shape through funding from the national treasury to offset the cost of drilling steam wells.
However, much of the work has been done by listed state corporation, Kenya Electricity Generation Company, popularly known as KenGen.
“Kenya is taking off and energy is the anchor engine. As a power generating firm, we have now developed a robust strategic plan heavily hinged on geothermal power,” says Albert Mugo, the Managing Director of KenGen.
According to government statistics, Kenya has a total power demand of slightly more than 1,500MW. The installed capacity is 2,000MW. Out of this, geothermal power contributes around 579MW, which translates to 44% to the national grid.
“We have a potential of 10,000MW of geothermal power in this country. We can still do more in terms of contribution to the national grid,” says Mugo.
The challenge in boosting geothermal power is financing. It is estimated that drilling one well costs between $8 and $10 million. To date, Kenya has more than 260 geothermal wells, mostly in Olkaria.
“The greatest challenge in this geothermal business is the perceived risk in exploring the steam wells,” says Mugo.
Apart from KenGen, other geothermal power producers have joined the fray, such as OrPower and Akira.
Kenya is ranked eighth in the world in geothermal positioning and first in Africa.
However, the focus is not only on geothermal energy. There is also interest in wind energy and solar power. While the two are at a nascent stage, Kenya has commissioned its first large-scale wind power project.
The Lake Turkana Wind Power Project (LTWP) farm site covers 40,000 acres and is expected to contribute 300MW to the national grid. When complete, it will become Africa’s largest wind power plant. Another wind project, managed by Aeolus Kenya, is expected to take shape soon. Located in central Kenya, it is expected to feed 60.8MW to the national grid.
The government, through KenGen, is also prospecting on a 400MW wind farm. This is scheduled for implementation in early 2016. Like the abundant geothermal energy sites, Kenya also has an area close to 90,000 square kilometers with excellent wind speeds of at least 6m/s.
Solar power is taking root with a number of companies entering the household market. This has seen many homes, especially in rural areas, replace the national power grid with solar energy.
“This growth in use of solar energy by household is largely attributed to the cost advantage. Solar power is much cheaper than national grid power,” says Robert Pavel Oimeke, the Director of Renewable Energy at the state-run Energy Regulatory Commission.
It seems that Kenya’s green energy growth plan is leading the way in Africa.

Tag: Power

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