Service - Leadership in Government - Issue 75
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energy<br />
S<br />
necessary <strong>in</strong>vestments, ecosystem partner<strong>in</strong>g requirements<br />
and potential moves from other companies, to<br />
ensure susta<strong>in</strong>able bus<strong>in</strong>ess models and assets.<br />
Don’t miss the green recovery fund<strong>in</strong>g. Energy<br />
companies’ focus is gradually switch<strong>in</strong>g from address<strong>in</strong>g<br />
the immediate implications of Covid-19 to navigat<strong>in</strong>g the<br />
<strong>in</strong>evitable downturn that the pandemic has triggered.<br />
<strong>Government</strong> stimulus packages are be<strong>in</strong>g prepared,<br />
and f<strong>in</strong>ancial support for the energy transition seems<br />
to be central to many government strategies. Leaders<br />
are poised to capitalise on the opportunity to accelerate<br />
a bus<strong>in</strong>ess model transition when government support<br />
materialises. The history of the energy transition is<br />
punctuated with rapid developments <strong>in</strong> technologies<br />
and <strong>in</strong>frastructure – stimulated by government subsidies.<br />
With the success of the energy transition, fundamental<br />
to so many companies, bold moves and rapid action will<br />
be needed to get on board the green recovery funds<br />
when they appear on the horizon.<br />
Drive an agenda with M&A opportunities and strategic<br />
partnerships. Cheap f<strong>in</strong>ance, publicly stated ambitions<br />
and broad awareness of the impact of the energy<br />
transition created a period of high activity across<br />
the market pre-Covid-19. The liquidity squeeze will<br />
<strong>in</strong>crease scrut<strong>in</strong>y of <strong>in</strong>vestments, plac<strong>in</strong>g small and large<br />
bus<strong>in</strong>esses <strong>in</strong> a unique position to explore radical moves<br />
absent from the table before the crisis.<br />
A key feature of the energy transition is the<br />
convergence of multiple sectors onto the same customer<br />
PUBLIC-PRIVATE PARTNERSHIPS<br />
Public-private partnerships (PPPs) are mechanisms<br />
that use public policies, regulations or<br />
f<strong>in</strong>anc<strong>in</strong>g to leverage private-sector f<strong>in</strong>anc<strong>in</strong>g.<br />
The ma<strong>in</strong> characteristics of PPPs for f<strong>in</strong>anc<strong>in</strong>g<br />
EE projects <strong>in</strong>clude:<br />
• A contractual relationship (or less formal<br />
agreement) between a public entity and a<br />
private organisation;<br />
• The allocation of risks between the public and<br />
private partners consistent with their will<strong>in</strong>gness<br />
and ability to mitigate risks, <strong>in</strong> order to encourage<br />
the private partner to mobilise f<strong>in</strong>anc<strong>in</strong>g;<br />
• The mobilisation of <strong>in</strong>creased f<strong>in</strong>anc<strong>in</strong>g for<br />
EE; and<br />
• Payments to the private sector for deliver<strong>in</strong>g<br />
services to the public sector.<br />
An example of a PPP is where the private partner<br />
may operate and ma<strong>in</strong>ta<strong>in</strong> energy systems or<br />
facilities, such as street light<strong>in</strong>g, under a service or<br />
lease agreement with a municipality, which serves<br />
as the public partner. Source: IEA, 2011<br />
base. No one bus<strong>in</strong>ess has all the capabilities to w<strong>in</strong> across<br />
the energy transition: a comb<strong>in</strong>ation of service, consumer<br />
platform and geographical footpr<strong>in</strong>t undoubtedly holds<br />
the key.<br />
Reset supply cha<strong>in</strong>s for post-pandemic demand while<br />
leap<strong>in</strong>g for decarbonisation. Covid-19 has forced a<br />
SUSTAINABLE INFRASTRUCTURE DEVELOPMENT<br />
In June 2020, Susta<strong>in</strong>able Infrastructure Development for South<br />
Africa (SIDSSA) was unveiled. The <strong>in</strong>frastructure project pipel<strong>in</strong>e<br />
br<strong>in</strong>gs critical role-players <strong>in</strong> the <strong>in</strong>vestment space to collaborate<br />
<strong>in</strong> build<strong>in</strong>g back a better, robust socio-economic nation.<br />
www.sidssa.org.za<br />
“We are <strong>in</strong>stitutionalis<strong>in</strong>g the SIDS<br />
methodology as a new way of<br />
packag<strong>in</strong>g and prepar<strong>in</strong>g projects<br />
for fund<strong>in</strong>g. This methodology will<br />
determ<strong>in</strong>e three pathways for project<br />
fund<strong>in</strong>g: commercial fund<strong>in</strong>g, blended<br />
f<strong>in</strong>anc<strong>in</strong>g and fiscal allocation. We look<br />
forward to an endur<strong>in</strong>g relationship that<br />
will help propel our economic recovery<br />
effort and br<strong>in</strong>g hope to the country.”<br />
President Cyril Ramaphosa<br />
“The public and private sectors<br />
share major po<strong>in</strong>ts of <strong>in</strong>tersection<br />
and significant commonalities that,<br />
together with the planned <strong>in</strong>frastructure<br />
projects, will help drive South<br />
Africa out of its current economic<br />
distress, now exacerbated by the<br />
Covid-19 pandemic.<br />
“We are aim<strong>in</strong>g for a fundamental<br />
alteration of the economic relations<br />
of society towards a shared future <strong>in</strong> which everyone must<br />
participate. Inclusivity and transformation are key <strong>in</strong>gredients to<br />
the South Africa that we want to construct.”<br />
Dr Kgosientso Ramokgopa, Head of the Investment and<br />
Infrastructure, Office <strong>in</strong> the Presidency<br />
“Now, for the first time, South Africa’s public and private<br />
sectors have come together to advance a common<br />
<strong>in</strong>frastructure development agenda, namely the creation<br />
of a reliable, robust <strong>in</strong>frastructure project pipel<strong>in</strong>e.<br />
<strong>Service</strong> magaz<strong>in</strong>e | 11