Parliamentary hearing needed on DTI solar-geyser rules
22 January 2015
The solar geyser manufacturing industry has claimed that the DTI's local content rules for solar geysers are too stringent and have resulted in 4500 jobs being lost in the industry. This is a serious matter, since the local content programme is supposed to encourage South African manufacturing and create jobs, not destroy them. These claims must be investigated fully to determine if the DTI's local content rules are indeed causing harm to local industry.
I will today write to the Chairperson of the Portfolio Committee on Trade and Industry to request urgent Committee hearings on the DTI's local content rules for solar geysers, and in particular the effect these rules have on employment in the solar geyser industry.
The industry has argued that restrictive and irrational government procurement rules have resulted in an impasse between industry and government, as supply has become nearly impossible due to the stringent local content threshold. This has resulted in substantial job losses, with a recent survey by Sustainable Energy Society of South Africa (Sessa) estimating that least 4500 jobs have been lost.
In July 2013, the Department of Trade and Industry classified low pressure solar water geysers as a "designated product" under government procurement rules, which in effect requires that each component of the geyser must consist of 70 per cent local content.