By Larry Claasen
SIEMENS Energy, Southern Africa’s chairman and MD, Thabo Molekoa, has a very clear understanding of his company’s mission, which is to help companies make the energy transition.
“Our mission is anchored around supporting customers to transition.”
The South African energy market is liberalising, meaning businesses are increasingly less dependent on power utility Eskom for power. With the market opening up, it means they can either generate their own electricity, or buy it from a company other than Eskom.
Molekoa says as the energy sector and its customers adapt to this changing environment, Siemens Energy’s role is to provide them with the technology to help them make this transition.
“We have technologies that can generate electricity, transmit electricity and distribute it, even all the way to green hydrogen.”
For example, its control systems technology has helped Eskom reduce carbon emissions.
“We are helping Eskom to decarbonise specifically the coal fleet.”
Siemens Energy also has an extensive wind generation division, which is servicing turbines that generate over a gigawatt of wind power in South Africa.
Surprisingly, the one area it is not in is solar power. Molekoa says the group used to play in that space, but the growing number of players in it, saw it exit.
“If you look at all the renewable bid windows, this just becomes such a competitive space. I mean, typically, if you pick up a phone and want to do rooftop solar, you’ll find a number of players and so on. So, the market is mature to that extent. So, therefore, there wasn’t any substantial value add we could bring. So, that’s why we moved out of that.”
An area of the energy market that excites Molekoa is Green Hydrogen.
Green Hydrogen is the creation of hydrogen to be used as a fuel. The hydrogen is created through the electrolysis process using renewable electricity as a power source.
Molekoa is optimistic about Green Hydrogen in South Africa, despite the long timelines for getting these projects off the ground and the lack of offtake agreements for many of these projects.
The way he sees it, it should be looked at in the same way how solar power got its start under the Independent Power Producer Procurement Programme over a decade ago. Solar power eventually took off because the government provided guarantees to the power producers.
“You know, no one wanted to take a risk. The state had to come in and give some guarantees around that. And from there, that’s when it picked up.”
He thinks with the same kind of backing Green Hydrogen can take off in South Africa.
Some of South Africa’s most notable Green Hydrogen projects like Boegoebaai in the Northern Cape and the one at the Saldanha Bay Industrial Development Zone (IDZ) will produce hydrogen for the export market.
Molekoa thinks more should be done to grow the domestic Green Hydrogen market.
“South Africa must focus on local demand. That’s an easier one. You have no dependency on another country to offtake and so on.”
Aside from developing a domestic Green Hydrogen market, Molekoa says the government must look at the whole energy infrastructure value chain.
The government, for example, would want to award a tender to a company that makes the cheapest bid, but if that company wanted to use locally made equipment, its cost would increase.
Molekoa wants to see government programmes that support the energy sector holistically, as incentives could be offered along the whole value chain. Doing this would develop the entire energy sector.
“Don’t look at a bid window or a generation project or a transmission project, look at the value chain. If you generate electricity, you have to transmit it and distribute it. If you sit with the whole scheme, then it’s easier to try and figure out what we could do for the energy sector.”
