Uncertainty over renewable energy results in job losses at wind turbine company

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The uncertainty in the renewable energy sector in South Africa has led to job losses in Nelson Mandela Bay. A wind turbine tower manufacturer, DCD wind towers, closed its factory in the Coega Industrial Development Zone (IDZ) after failing to find an equity investment partner. The failure to find investment is related to the proposed independent power producers programme which will not see any new wind farms erected between 2022 and 2025.

DCD ran into trouble in 2016 when no new orders were placed due to the planned gap in wind farm expansions. The Industrial Development Corporation took an 80% stake in DCD wind towers but that did not generate renewed interest. The manufacturing facility has now closed its doors and retrenched its workers.The plant employed 110 people.

Boilermaker, Nokubona Tukayi Manyelo says, “I’m definitely not ok because we all know that South Africa is suffering and we are also going to be falling on those statistics of the people that are looking for jobs.”

DCD sold its stake in DCD Wind Towers to the IDC for one million rand in 2017 but it did not succeed in securing a strategic equity partner. The IDC have been paying the workers since 2016.

Head of Workout Restruction at the IDC, Mpho Mosweu says, “You see the partners when they assessed the investment they were very positive especially when the round four was signed, but however when they looked into the future they could see that there is going to be a gap of three years, where there aren’t going to be any wind farms that are going to be built. The minute the wind farms are not built it means there won’t be any orders that will be coming through to DCD towers to supply towers, so based on that it means for three years the plant will not be producing anything, meaning there won’t be any income coming through.”

The Department of Energy says they are supporting local manufactures by ensuring projects continue despite delays in the  Independent Power Producer Procurement (IPP) programme. The department says the IPP agreements were signed on time when the new minister, Jeff Radebe, took office.

The department says it is focused on procurement rather than manufacturing, but it does support manufacturing within the IPP programme as it creates local jobs.

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