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Why SMEs should look at alternative energy solutions

Jul 07 2017 18:49

Cape Town - The financial strain on South African businesses is expected to increase exponentially in the foreseeable future as Eskom’s planned 19.9% tariff hike was announced to the public in June, according to Cala van der Westhuizen, head of marketing and sales at Energy Partners Home Solutions, a division of Energy Partners, and part of the PSG group of companies.

Van der Westhuizen said South Africa is still likely to see above inflation increases in electricity prices over the coming years.

“In light of Eskom motivating for a near 20% increase to already high electricity prices, it is becoming increasingly important to consider alternative sources of energy,” said Van der Westhuizen.

Van der Westhuizen explains that this continuing trend will have the largest impact on small and medium enterprises (SMEs).

“As we have seen in previous years, energy tariff hikes and other power related issues such as load shedding, had massive impacts on the operating costs and the already low profit margins of SMEs. There are however opportunities for smaller companies to reduce the impact of power costs and supply on their business,” said Van der Westhuizen.

Incentives

Van der Westhuizen says SMEs should take advantage of the incentives provided for the installation of renewable energy solutions.

“SMEs need to keep in mind that they can claim a percentage of the cost of solar and other renewable energy solutions back from SARS. Some banks also offer financing to their business banking clients for renewable energy solutions,” said Van der Westhuizen.

Another alternative for businesses, according to Van der Westhuizen, is to consider applying for financing.

There are many benefits to installing solar energy solutions in small businesses, all of which contribute to reducing operating costs and downtime in the event of power outages, according to Van der Westhuizen.

“A full solar solution can reduce the average SMEs electricity costs by as much as 30%. This figure is of course dependent on the nature of the business. Additionally, with custom heating, cooling and energy efficiency solutions tour clients can achieve a further 30% reduction in their electricity spend,” said Van der Westhuizen.

“Reliability of energy supply is vital for SMEs. Making the correct decisions, implementing the right energy solutions and using the optimal financing vehicle to will significantly reduce an SME’s annual energy costs.”

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eskom  |  small business  |  energy  |  entrepreneurs
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