Boxes of Jungle Oats, one of South Africa's Tiger Brands original products, sit on a shelf in a Cape Town convenience store. Photo: Reuters
Tiger Brands, the maker of Jungle Oats and Tastic rice, plans to kick off a multi-million-rand investment into solar power at its manufacturing sites.
This is towards its goal of having 65 percent of the business’s electricity requirements at a manufacturing level across South Africa sourced from sustainable energy solutions by 2030.
South Africa’s largest food company said it planned to do this through the procurement of power purchase agreements from independent power producers, as well as other renewable energy options.
Tiger Brands also needs to keep its expenses cost contained. Consumer goods companies are grappling with a surge in commodities, energy, transport and labour costs, which have been compounded by the war in Ukraine. Tiger Brands is particularly exposed because of its reliance on food - where inflation is especially high.
In May, Tiger Brands posted a drop in half-year earnings. Headline earnings per share, a key earnings measure in the country, for continuing operations fell to 729 cents in the six months ended March 31, from 741cents a year earlier.
This is as South African companies battle with unreliable power supply from state-owned utility Eskom, which is detrimental to both their operations and bottom line.
In July President Cyril Ramaphosa said companies would be allowed to build power plants of any size without a license to meet their own needs and to sell it to the national grid.
“Onsite solar power, and other renewable energy solutions, will be installed at 35 Tiger Brands manufacturing sites across South Africa by 2030, beginning with four sites, which will generate 2 megawatts of power, providing at least a third of their power usage,” Tiger Brands said in a statement today.
The first four sites are Tiger Brands’ Henneman Mill in the Free State, King Foods in the North West, as well as its beverages and HPC (home and personal care) manufacturing plants in Gauteng.
Solar power generation at these sites was expected to go online between the last quarter of this year and the first quarter of 2023.
Derek McKernan, Tiger Brands’ chief manufacturing officer, said: “Harnessing the power of natural energy sources is first and foremost about minimising our impact on the environment and doing our part to reduce reliance and strain on the national grid so that more South Africans have access to the resource.”
Tiger Brands aims to reduce its energy intensity by 30 percent by 2030.
“This is not a one-size-fits-all solution that we are introducing. We want to ensure that we assess the requirements of each site individually and implement initiatives and innovations that best suit each site while removing all forms of power wastage,” said McKernan.
Tiger Brands also said its goal was to reduce its greenhouse gas emissions by 45 percent against science-based targets by 2030, with a target of net zero emissions by 2050.
With this in mind, Tiger Brands was also exploring biogas, wind, batteries and hydrogen amongst other energy options.
“The company has introduced several initiatives to reduce energy intensity at its manufacturing sites to maximise efficiency efforts. Some of these optimisation initiatives include detailed site investigations to identify water and energy reduction opportunities, as well as ensuring accurate measurement and metering at the sites,” it said.
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