While a moratorium has been placed on the sugar tax for the next two years, the South African Sugar Association says it remains concerned about the devastating impact of the Health Promotion Levy , also known as the sugar tax. A creative plan to use the byproducts of the sugar generation process could, however, be the industry's saving grace, while also alleviating some of the strain on South Africa's struggling electricity grid.
“As an industry, all focus is now on the future and diversification, in addition it is our plan to use this time wisely to reimagine our sector,” said Funke.Sweet, sweet co-generated electricity The industry says newly appointed Electricity Minister, Dr Kgosientso Ramokgopa, has indicated his willingness to engage with the sugar sector on co-generation given the sugar industry’s potential to generate up to 800MW of co-generated electricity on to the grid.Co-generation is the production of multiple forms of energy, such as heat and electricity from a single fuel source.
Previous studies conducted by the industry showed that approximately 700MW – 800MW of sugarcane fibre-based electricity could be exported to the national grid if all 14 sugar mills implemented the required improvements to export this capacity.Prior to this year’s budget speech, the industry had pleaded with government not to increase the sugar levy or lower the current threshold as this would decimate the sector.
As a result of the continued decline in an area under cane , two mills have been forced to close due to insufficient supply.
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