Rolling blackouts have cost Spar more than R700 million in diesel for generators over a six-month period, the retailer said, as it warned of much higher spending if the power situation deteriorates.
ROLLING blackouts have cost Spar more than R700 million in diesel for generators over a six-month period, the retailer said, as it warned of much higher spending if the power situation deteriorates.
Crippling power cuts are leaving households and businesses in Kimberley and across the country in the dark for up to 10 hours a day, but with 97% of its stores covered by generators, Spar’s operations remain largely uninterrupted, interim CEO Mike Bosman told Reuters.
Spar’s spending on fuel for its generators, which are ready to run 24 hours a day, makes doing business “unbelievably expensive”, but the cost is not being pushed onto consumers.
And with the power cuts showing no sign of abating, Bosman said that at current levels Spar’s diesel spend for its full financial year was going to be R1.4 billion rand.
“If it (the power situation) does not improve and if it deteriorates, it’s going to be much more,” he said yesterday.
In addition to its diesel costs, Spar has had to navigate an acceleration in food price inflation. Inflationary pressures weighed on Spar’s half-year headline earnings per share, which fell by 30.3% to 447.9 cents.
[ON AIR] Retail giant SPAR have spent over R700 million in load shedding related costs in their previous financial year.
SPAR Group CEO, Mike Bosman joins @gugumfuphi to look at how the company has performed. pic.twitter.com/UsAuc7hsqx
— On the street. On the air. (@KayaOnAir) June 14, 2023
“We’re doing our very best to supply groceries for the main part to consumers, who in any event are feeling the pinch,” Bosman said.
South Africa’s food and non-alcoholic beverages inflation for April was 13.9%, government data shows.
Meanwhile, with the Northern Cape leading the charge for more renewable energy, the country is seeking affordable solar panels, wind turbines, battery storage and renewables technology from China, South Africa’s electricity minister said earlier this week.
Apart from reducing the daily rolling blackouts, the country is also trying to ramp up its renewables capacity, especially solar, through industrial-scale plants and rooftop installations.
“We’re looking to China to help us to resolve that problem with regards to the availability of equipment,” Electricity Minister Kgosientsho Ramokgopa said on the sidelines of a South Africa-China energy conference.
The country has up to 66 gigawatts (GW) of wind and solar projects in the pipeline, Ramokgopa said, adding that more than 5 500 megawatts (MW) out of this would come online by 2026.
The bulk of the renewables power capacity would come from solar installations at homes and government buildings that will require a huge supply of solar PV panels, Ramokgopa said.
He said he would be taking a delegation to China in the coming weeks to build a “relationship with the Chinese”, but ruled out seeking any financial support for debt-laden Eskom.
“We have gone to all other embassies, you are the only ones who have come back to us saying ‘we will assist you without any condition’,” Ramokgopa said.
Siyabonga Cwele, South Africa’s ambassador to China, said via a video message that China’s advanced and affordable technology could help South Africa achieve its energy goals.
– REUTERS
