Dairy giant Clover will reap the benefits from a servitisation deal at its Queensburgh mega-factory with energy solutions company, Energy Partners (EP).
As part of this industry-leading partnership, EP designed, invested R360 million and constructed the integrated refrigeration, power and steam plant, which it will operate and maintain over the next 20 years.
Servitisation, whereby clients pay for a service rather than the equipment itself, means that Clover will only pay a fee per unit of the refrigeration and steam it uses, enabling the dairy company to lower its operational costs by as much as R792m over the period of the agreement.
EP CEO Manie de Waal said yesterday in a statement that the model highlighted an opportunity for commercial and industrial businesses to increase their bottom line while decreasing operational costs and risks in a very challenging economic environment.
“South Africa’s limited and unstable power supply is now a medium-term certainty. More than just electrical power, it is absolutely critical to identify opportunities across the total energy ecosystem, such as refrigeration and steam supply, whereby capital can be preserved, efficiency increased, and costs reduced,” De Waal said.
Anton Pretorius, Clover's Group Manager: Product Technology and Technical Services, explains: “This removal of upfront investment, together with the fact that we have access to a modern, automated plant that EP has committed to guaranteed uptime and efficiency in line with industry standards, has resulted in lower operational costs and ensures that Clover is at the forefront of efficient and sustainable technology.”
Critically, Clover's servitisation agreement with EP has secured the mega-factory a reliable supply of refrigeration and steam, with cooling efficiency alone increasing by 40 percent.
It will also avoid 132 million tons of CO2 emissions over the 20-year term.
BUSINESS REPORT