Let there be light
There still aren’t any pure-play green energy options on the JSE, though a few names are worth considering
Does South Africa’s power crisis still offer opportunities for switched-on investors on the JSE?
Lower levels of load-shedding for now probably preclude investors fixating too darkly on the effects of disruptive power cuts. There are optimistic contentions that the worst of the power cuts is over and that disruptions will become more “manageable”.
Then again, as economic activity picks up and the country moves into the winter months not to mention the passing of promises made in the run-up to an important general election a stuttering energy supply could easily become a major concern once more. And there’s the increasingly exorbitant cost of Eskomsupplied electricity.
As with companies providing security services, logistics and private education, those able to supply alternative power should, on paper, still be tapping a pretty sweet spot for the foreseeable future.
The Southern African renewable energy market is estimated to grow by R90bn from 2021 to 2026 at a compound annual growth rate of 30%.
Yet the JSE-listed companies involved in alternative power supply are hardly trading at demanding premiums.
Of course, the biggest hitch for investors looking to capitalise on “private” energy solutions is that aside from small solar and wind farm investment company Mahube Infrastructure there’s no “pure” alternative energy play.
Helium business Renergen is still some way off convincing investors it has a commercially viable project in Virginia, and Montauk Renewables which produces gas and electricity, mainly from landfills