INCORPORATING COLD CHAIN
ASSOCIATIONS
Image supplied by GCCA Africa
Paul Matthew opening GCCA Africa Conference 2024.
generators and battery systems, as well as the establishment of specialised cold chain hubs in key locations. Additionally, fostering alliances with energy providers and industry stakeholders could provide better bargaining power to secure more reliable energy solutions for critical sectors.
Chinembiri emphasises the importance of not allowing the recent reprieve from load shedding to lull the sector into complacency. " The threat is still there, and we need to be prepared for the possibility of future disruptions. It ' s essential that we start thinking long-term about building resilience in the cold chain now, before the next crisis hits."
The study serves as a crucial call to action for policymakers, industry players, and stakeholders to take proactive measures in securing the cold chain and ensuring that South Africa’ s food and pharmaceutical sectors are better equipped to withstand future power disruptions.
" We spoke to about 15 sectors and industry experts, and while some of the challenges were already known, there were several unexpected insights that emerged, which are critical for moving forward," says Chinembiri. The study uncovered several major impacts of loadshedding on the cold chain, with one of the most significant being its direct effect on food inflation. According to the research, loadshedding contributed to an estimated 0.5 % increase in food prices, a substantial burden for lower-income households that allocate a large portion of their income to food.
From an operational standpoint, businesses in the cold chain sector faced severe disruptions. These included reduced staff productivity, increased equipment breakdowns and a rise in maintenance costs— all of which added significant financial pressure. Many businesses responded by investing in alternative energy solutions, such as solar panels and diesel generators. However, these solutions came at a high cost, with some businesses reporting upfront capital expenditures ranging from R500 000 to R1 million for solar and battery installations, and operational costs for diesel generators running between R50 000 and R100 000 annually.
Despite the financial strain, the study also highlighted some positive outcomes.
In response to the challenges posed by loadshedding, many businesses sought to optimise their operations. This included identifying inefficiencies and streamlining processes, which not only helped businesses survive but also had a positive environmental impact by reducing energy waste.
Based on these findings, Chinembiri outlines six key recommendations aimed at strengthening the cold chain and ensuring its resilience in the face of ongoing power disruptions:
• Incentivise renewable energy investments: The study calls for more meaningful incentives for businesses to invest in renewable energy solutions, such as solar power and battery storage. While some incentives already exist, there is room for improvement to make them more impactful and accessible to cold chain operators.
• Suspension of duties on solar and battery components: A bold recommendation is the suspension of import duties and VAT on solar components and batteries for a year, which would lower the upfront costs of renewable energy solutions for businesses in the cold chain sector.
• Support for technology solutions: The study advocates for investment in technology that enables real-time tracking and monitoring of cold chain logistics. This could enhance efficiency and reliability, especially for exporters dealing with perishable goods. Publicprivate partnerships could help drive down the cost of such technologies, making them more accessible to businesses across the sector.
• Streamline trade facilitation: Another recommendation is to improve trade facilitation within the African Continental Free Trade Area( AfCFTA), particularly at border posts. Reducing waiting times, such as at the notorious Beitbridge border, would help cold chain operators move goods more efficiently and reduce the risks associated with extended transit times.
• Use the cold chain as an energy storage resource: Chinembiri suggested exploring the potential of the cold chain sector as an energy storage solution through demand-side management. This would require extensive coordination among all stakeholders but could provide a valuable resource in balancing the national energy grid.
• Reduce downtime from equipment failures: Finally, the study recommends efforts to reduce downtime caused by equipment failures linked to power disruptions. This could involve investing in more reliable equipment and improving maintenance protocols to ensure that cold chain operations continue running smoothly even during load shedding.
Chinembiri concludes by stressing the importance of collaboration between government, industry players and other stakeholders in addressing the challenges posed by loadshedding. " We need to bring together all the relevant parties to take action, not just talk about it. It ' s time to move from vision to action," the researcher says. CLA
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