South Africa unveils rescue plan for ailing power company

A woman carries firewood on her head as she walks below Eskom’s electricity pylons in Soweto, South Africa. (Reuters/File)
Updated 29 October 2019

South Africa unveils rescue plan for ailing power company

  • “The restructuring of Eskom has the benefits of increasing transparency, particularly in respect of costs”

JOHANNESBURG: South Africa on Tuesday unveiled plans to fix its embattled state power utility Eskom, which has sporadically suffered rolling blackouts that plunged businesses, schools and homes into darkness.

Public Enterprises Minister Pravin Gordhan detailed a long-awaited roadmap that will see Eskom divided into three subsidiaries: Generation, transmission and distribution.

Gordhan said that the transmission unit — which conducts electricity and manages 45,000 km of power lines — would be the first to become a stand-alone entity, still owned by Eskom.

That process is expected to be completed by March 2020.

“The restructuring of Eskom has the benefits of increasing transparency, particularly in respect of costs,” Gordhan said.

Eskom, which generates around 95 percent of South Africa’s electricity, has accumulated $30 billion of debt despite receiving multiple government bailouts.

Credit ratings agencies have warned that Eskom’s debt could cause downgrades and embarrass President Cyril Ramaphosa, who was re-elected this year in part on a pledge to restore the economy.

Eskom has long struggled to produce enough power due to aging and poorly maintained coal-fired power stations combined with decades of mismanagement and alleged corruption.

South Africa was hit by a week of rolling blackouts earlier this month — a tactic known as ‘load-shedding’ — aimed at rationing electricity when demand is too strong.

Gordhan gave no details on Eskom’s financial restructuring, saying only that Finance Minister Tito Mboweni was likely to comment on its debt when he presents a mid-term budget on Wednesday.

Energy supplies had to stay ahead of business activity, Gordhan said, “so that we are not acting as a constraint on economic growth.”

South Africa’s government plans to pour 128 billion rand (around $8.8 billion) into Eskom over the next three years.

State-owned companies were at the center of corruption scandals known as “state capture,” under South Africa’s former President Jacob Zuma.

Gordhan said that continues to affect the utility in a “systematic” way as many highly-skilled professionals were squeezed out of Eskom.

A new CEO is also be announced in coming weeks to replace Phakamani Hadebe, who resigned in July citing “unimaginable demands” of the job.

The new business plan should also expose Eskom to more competition and orient it toward renewable sources of energy.

The utility will be expected to cut coal and diesel costs and negotiate lower prices from renewable energy suppliers.

Power stations are to be grouped into clusters and compete among each other to give consumers cheaper electricity.


A Jordan startup delivers eco-friendly alternative to dry cleaning

Updated 05 December 2019

A Jordan startup delivers eco-friendly alternative to dry cleaning

  • Products used by WashyWash are non-carcinogenic and environmentally neutral
  • Amman-based laundry service aims to relocate to a larger facility in mid-2020

AMMAN: A persistent sinus problem prompted a Jordanian entrepreneur to launch an eco-friendly dry-cleaning service that could help end the widespread use of a dangerous chemical.

“Dry cleaning” is somewhat of a misnomer because it is not really dry. It is true that no water is involved in the process, but the main cleaning agent is perchloroethylene (PERC), a chemical that experts consider likely to cause cancer, as well as brain and nervous system damage.

Kamel Almani, 33, knew little of these dangers when he began suffering from sinus irritation while working as regional sales director at Eon Aligner, a medical equipment startup he co-founded.

The problem would disappear when he went on vacation, so he assumed it was stress related.

However, when Mazen Darwish, a chemical engineer, revealed he wanted to start an eco-laundry and warned about toxic chemicals used in conventional dry cleaning, Almani had an epiphany.

“He began to tell me how PERC affects the respiratory system, and I suddenly realized that it was the suits I wore for work — and which I would get dry cleaned — that were the cause of my sinus problems,” said Almani, co-founder of Amman-based WashyWash.

“That was the eureka moment. We immediately wanted to launch the business.”

WashyWash began operations in early 2018 with five staff, including the three co-founders: Almani, Darwish and Kayed Qunibi. The business now has 19 employees and became cash flow-positive in July this year.

“We’re very happy to achieve that in under two years,” Almani said.

The service uses EcoClean products that are certified as toxin-free, are biodegradable and cause no air, water or soil pollution.

Customers place orders through an app built in-house by the company’s technology team.

WashyWash collects customers’ dirty clothes, and cleans, irons and returns them. Services range from the standard wash-and-fold to specialized dry cleaning for garments and cleaning of carpets, curtains, duvets and leather goods.

“For wet cleaning, we use environmentally friendly detergents that are biodegradable, so the wastewater doesn’t contain any toxic chemicals,” Almani said.

For dry cleaning, WashyWash uses a modified hydrocarbon manufactured by Germany’s Seitz, whose product is non-carcinogenic and environmentally neutral.

A specialized company collects the waste and disposes of it safely.

The company has big ambitions, planning to expand its domestic operations and go international. Its Amman site can process about 1,000 items daily, but WashyWash will relocate to larger premises in mid-2020, which should treble its capacity.

“We’ve built a front-end app, a back-end system and a driver app along with a full facility management system. We plan to franchise that and have received interest from many countries,” Almani said.

“People visiting Amman used our service, loved it, and wanted an opportunity to launch in their countries.”

WashyWash has received financial backing from angel investors and is targeting major European cities initially.

“An eco-friendly, on-demand dry-cleaning app isn’t available worldwide, so good markets might be London, Paris or Frankfurt,” Almani said.

 

• The Middle East Exchange is one of the Mohammed bin Rashid Al-Maktoum Global Initiatives that was launched to reflect the vision of the UAE prime minister and ruler of Dubai in the field of humanitarian
and global development, to explore the possibility of changing the status of the Arab region. The initiative offers the press a series of articles on issues affecting Arab societies.