Green tech hub predicts R1bn investment boost
Building on an already substantial investment base, continued cooperation between local, provincial and national government could see an additional R1bn in direct investment pumped into a proposed green technology special economic zone (SEZ), over the next five years.
Mike Mulcahy
In 2013, GreenCape and the department of trade and industry (dti) signed a memorandum of funding agreement to set up a project management unit to facilitate a green technology SEZ in Atlantis. This work is a collaborative effort between GreenCape as the hosting agency, the City of Cape Town, Western Cape provincial government and the dti.
Tapping into REIPPP boom
The proposed SEZ supports the manufacturing sector to become suppliers and component manufacturers for clean technology, such as renewable energy components.
South Africa aims to generate 17,800MW of electricity from renewable resources by 2030. A significant share of the new electricity capacity is being developed and produced by independent power producers (IPPs) through the government’s renewable energy independent power producers programme (REIPPP). The proposed SEZ has a particular focus on tapping into the attractive local content opportunities created through this programme.
“The Western Cape is fast becoming a preferred destination for renewable energy and technology businesses and their investors. At least 12 new industrial manufacturing facilities, capable of supplying utility scale projects, have been established in the country in direct response to the REIPPPP, with the establishment of two more large manufacturing concerns in the pipeline. Of these, eight are in the Western Cape,” says GreenCape CEO, Mike Mulcahy.
R680m already invested
GreenCape has reported investments in Atlantis totalling R680m over the past three years and says a further R1bn worth of new direct investments has been forecast for the next five years.
After an initial investment of R300m, Spanish-owned Gestamp Renewable Industries (GRI) invested in a further expansion of its wind tower manufacturing facility. The company has already supplied 35 of its towers to the Noupoort wind farm in the Northern Cape.
The confidence in the Atlantis green tech hub is clear and expansions by Skyward windows and geotextile company, Kaytech have added an additional R50m and R130m respectively to investments in the region in the last financial year.
Investment future is bright
The Atlantis SEZ feasibility report, conducted by Stratecon, estimated that every rand invested by national government returns R250 in GDP, R34 in tax income and R60 in foreign exchange.
More than 300 direct jobs have been created in Atlantis in the last two years, which has had a significant impact on the local community. This has been augmented by a concerted local skills development programme which includes high-level welding and solar PV installation training.
“The investment future is bright. Infrastructure like the MyCiti bus, fibre optic cable, road upgrades and electricity upgrades combined with good governance, readily available skills, attractive financial incentives and energy security make for a powerful convergence of opportunities. These factors, added to the clear cooperation and alignment across the three layers of government, and the fact that the project is an extremely efficient government spend to create jobs and economic value and already showing notable results, create a compelling investment opportunity in green tech,” Mulcahy concludes.
