Department of Trade and Industry sets record straight on solar water heater reports

JANUARY 26, 2015

The Department of Trade and Industry (dti) says it has noted allegations that rules around the designation of solar water heater components are killing the industry.

“The dti has noted the recent media reports regarding the designation of solar water heater (SWH) components. These reports allege that the formulation of the procurement rules have contributed to killing the industry and contributed to job losses,” said the department.

The department said these reports contain several factual errors, including that the designation of solar water heating components at 70% for tank and collector local content requirement for local manufacturing has led to the destruction of the solar water heating industry.

However, the dti said that according to the South African Bureau of Standards (SABS) local content verification, there are several companies that have qualified in line with stipulated local content of 70% for tanks and collectors.

“The dti is also aware that the compliant manufacturers are able to supply when procurement commences. Furthermore, both importers and local manufacturers of SWH are free to sell their products in the domestic and export market, subject only to the building and safety standards that apply in South Africa and export destinations.

In 2013, the department made the low-pressure solar water geyser a “designated product” under government’s procurement rules. It said both the tank and collector tubes, which absorb the sun’s radiation to heat the water, must each have 70% local content.

“Temporary exemptions from the local content designation for public sector procurement can be granted where exceptional supply constraints exist. This is the prerogative of the procuring entity, in this case, the Department of Energy (DoE).

“To date, the dti has received no indication from the DoE that such an exemption is necessitated by supply constraints from local manufacturers,” said the dti. -