Economists have devised theoretical frameworks to explain various market structures. The foundational model is perfect competition, characterised by numerous suppliers and consumers offering the same product, easy and cost-free interactions between buyers and sellers, and no barriers preventing new suppliers from entering the market. In a perfectly competitive scenario, no individual or entity holds the influence to manipulate prices.
In cases of monopolies, there usually exists a barrier, whether inherent to the industry or imposed by regulations, that discourages potential competitors. For instance, public utilities often function as monopolies because it would be impractical for multiple companies to manage essential tasks like overseeing watersheds, negotiating usage rights, and installing pipelines to homes. However, consumers are left with no choice but to obtain services from the monopolistic provider, which can sometimes result in limited access for certain individuals due to cost constraints. Consequently, governments frequently impose regulations on these monopolies to ensure they do not misuse their dominant market position by setting excessively high prices.
The energy crisis in South Africa is significantly impeding the smooth operation of businesses across the country, hindering the essential progress necessary to sustain a thriving economy. The troubling frequency of power interruptions is causing disruptions in operations and thwarting companies’ efforts to achieve their production targets.
Getting Granular with Virtual Wheeling
Virtual wheeling is a method where energy transactions take place through documentation or electronic means, granting electricity buyers and sellers the flexibility to trade energy without the necessity of physically transmitting it via transmission or distribution lines. This is mainly accomplished through agreements, trading platforms, and grid management systems.
Virtual wheeling agreements are helping South African based companies get closer to their objective of procuring the majority of their electricity needs from renewable energy sources, simultaneously bolstering the capacity of the overburdened national grid.
Renewable Energy for Businesses
In the context of the majority of non-industrial enterprises, the generation of electricity stands out as a significant contributor to their emissions, accounting for approximately 80%.
Direct emissions are emissions directly originating from sources that an organisation either owns or has control over. On the other hand, indirect emissions result from the generation of purchased electricity, steam, heat, and cooling. These emissions are linked to the power plants responsible for generating the electricity that an organisation procures and utilises.
Choosing renewable energy sources for your electricity and heating can make your home more sustainable. MEB can help you take advantage of the opportunities that are presenting themselves for businesses wanting to improve operation and efficiently build a resilient organisation and supply system.