How manufacturers can transition to 100% renewable electricity

In a tough economy, businesses in South Africa are constantly looking to save more money. Especially in the manufacturing sector which has struggled in recent years to a point where jobs were shed.

Statistics from the second quarter of 2024 showed that even with suspended load shedding in the country, the sector still experienced low demand for manufactured goods.

Paul Holdredge, director for industrials and transport at consultancy Business for Social Responsibility (BSR) says moving the sector to 100% renewable electricity is a great challenge, however it is possible.

Manufacturers’ energy consumption

Referring to the International Energy Agency, Holdredge says manufacturing and other industrial users make use of at least one-third of the world’s energy consumption.

“Electricity is a central element of that. If all the power consumed by factories and industrial plants came from renewable sources, it would make a sizeable contribution to tackling climate change.”

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He believes organisations with lighter electricity needs and stable finances will be best positioned to transition to renewables.

When it comes to companies with high electricity demand, furnaces for glass, or other large-scale heating applications, and companies with large footprints, like expansive warehouses and assembly operations, may have more difficulty.

“According to the International Renewable Energy Agency (IRENA), the price of solar photovoltaic power in 2010 was typically 710% higher than the cheapest fossil fuel, but by 2022 it was 29% cheaper.”

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Manufacturers’ challenge

Holdredge adds a manufacturer’s ability to move to 100% renewable energy is not based solely on the price of renewable energy.

What usually hamstrings a fully renewable transition is the required initial capital investment and first-mover disadvantage, whereby it costs pioneers more than those that follow them to deploy new technologies

There are certain renewables that are not available in other parts of the world and for some of these products, an appropriate infrastructure must be in place for this energy to be delivered.

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Practical methods for companies to consider:

Generating electricity on-site

“Via rooftop solar panels or, if space allows, wind turbines. Even if they do not generate all the power needed, they can still make a useful contribution,” he says.

Develop battery storage facilities

Holdredge explains that storage technology is another safe option, as one of the concerns about renewable electricity is the risk of supply being interrupted when the wind isn’t blowing or the sun isn’t shining.

The future for greener manufacturing

“Addressing climate change can improve the livelihood of many people. At the same time, manufacturers and their shareholders stand to gain commercially from adopting a proactive approach.”

He details that companies with greener credentials are increasingly likely to be rewarded by consumers and investors, making it a crucial aspect of long-term market positioning.

“Increased use of renewable energy sources and greater self-generation can enhance a company’s ability to withstand fluctuating electricity prices in the open market.”

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