Mediclinic’s solar investment drives real transformation

Posted on 13 Sep 2018

Mediclinic’s partnership with Kigeni Holdings is uplifting both parties. The project, which will see solar energy resources installed in 10 Mediclinic hospitals across South Africa, is designed to both reduce the hospital group’s nationwide carbon footprint and empower small, black-owned businesses.

This project will provide suitable Mediclinic hospitals with a cost-effective, ecofriendly and stable power source. “We decided to invest in solar energy because our facilities are naturally geared towards it. We have large roof sizes, and our hospitals are located across the country, in many beneficial, sun-soaked areas,” says Andrew Boden, Related Business Executive: Mediclinic Southern Africa.

Mediclinic has invested over R32 million in Kigeni Ventures, a 100% black-owned and managed venture capital company that uses these funds to invest in several black-owned, qualifying small enterprises. These enterprises use those funds to build solar photo-voltaic installations – commonly known as “PV plants” – which will provide ecofriendly solar power to Mediclinic hospitals across South Africa.

In addition to this investment, each enterprise will operate and maintain the PV plants at each of the hospitals on long-term contracts.

“The strategic goal of this partnership is quite simple,” says Boden. “We want to help stimulate real transformation. This means not only complying with the letter of the new employment equity codes but meeting the spirit of those codes too. Our aim is true empowerment and real upliftment of people on the ground.”

The partnership with Kigeni allows Mediclinic to play a proactive role in BEE expansion. By investing in enterprise and supplier development, and supporting a BEE fund manager and investor, the hospital group ensures it is spending on preferential procurement, creating jobs and developing new skills in the workforce.

Each of the black-owned enterprises tasked with operating and maintaining the on-site power plants qualify as BEE suppliers and/or small enterprise companies. Each of them will own over 3 megawatts’ worth of PV projects. The average plant takes about five months to complete, although this can vary. This means that the construction of the 10 Mediclinic sites will employ 60 people, on a full-time basis, for a period of five months.

Nine new permanent roles will also be created, and these include quality managers, team leaders, maintenance staff and bookkeepers. “Our aim is to have all 10 sites in the initial development plan operational within this financial year,” says Boden. “We are dedicated to ensuring that we partner with suppliers who will help ensure real empowerment and real transformation.”

Kigeni Ventures and their qualifying small enterprises are responsible for rolling out the installation of these PV plants. “Along with our technical partner, Terra Firma Solutions, we plan, engineer, construct, commission, monitor and provide monthly performance reporting on the PV plants,” says owner Erik van Veen. “We work closely with Mediclinic to ensure the plants are built and designed to meet their strict health and safety requirements. Once a number of plants have been built, we will train and skill up the individual enterprises to operate and maintain the plants. We will provide oversight of this to ensure this is done in compliance with all hospital and legal regulations.”

Plants are installed and operational at two Mediclinic hospitals thus far: Mediclinic Thabazimbi and Mediclinic Lephalale – and Kigeni is evaluating the suitability of a further eight. These include Mediclinic Hoogland, Mediclinic Nelspruit, Mediclinic Welkom, Mediclinic Panorama and others. “We’re eagerly awaiting in-depth results from the two sites that are up and running, but from what we have seen so far, the plants are operating 20% ahead of expectations,” says Boden.

Mediclinic has long shown a keen interest in the benefits of renewable energy. “We started investing in solar energy about 10 years ago in Oudtshoorn,” says Kobus Jonck, General Manager Infrastructure: Mediclinic Southern Africa. “At the time it was an extremely expensive new technology, with an estimated return-on-investment of about seven to eight years. This partnership with Kigeni Ventures is really a fulfilment of that vision.”

This investment also positions Mediclinic as a leader in green energy production. Mediclinic is the only hospital group to be A-listed by the non-profit Carbon Disclosure Project, says Jonck. The carbon savings of this project cannot be underestimated. Together, nine of the hospitals targeted for power plant installation will save an estimated 4,365 tCO2e per year. This is comparable to removing 870 cars from the roads per year, saving over 2 million litres of petrol each year, or planting over 3,500 acres of new forestry per year.

Published in Business