Garreth Sparks, Zululand regional manager for the SA Cane Growers Association, wrote in a recent association newsletter that the sugar industry had repeatedly emphasised the significant role that it could play in producing bio-ethanol and in generating power at sugar mills.
According to Sparks, local renewable energy markets cannot develop without a long-term investor-friendly policy environment.
In 2007 the Department of Energy announced a policy on biofuel, but nothing has since happened.
Sugar cane is regarded as one of the best raw materials for ethanol production, and in the 1970s Brazil started serious production of ethanol from sugar cane.
Sparks said local ethanol would currently find it hard to compete with global producers without import tariff protection.
A mandatory level of combining biofuel with conventional fossil-fuel products would be necessary to get the industry going.
The South African sugar industry has had a difficult 2010/11 season.
Floods and droughts in sugar-producing countries have sent the global sugar price to record highs but, because of the local drought, sugarcane production was 16m tonnes instead of the 19m tonnes estimated at the beginning of the season, as noted in the latest South African Cane Growers Association report.
Sugarcane exports declined 51% to 377 709 tonnes compared with the previous season.
Income from sugar exports was 53% down on the previous season, at R1.07bn, and total net earnings for the industry amounted to R8.29bn compared with R8.36bn the previous year.
The association’s executive director David Wayne said in the annual report that renewable energy presented the sugar industry with opportunities for new income streams.
Bio-ethanol production and electricity generation from sugar cane are practical product diversifications that could improve the profitability of sugarcane farmers, the report continues.
Following continuous pressure from the industry, the National Energy Regulator has indicated that sugarcane fibre would be included as a fuel resource for its tariff for electricity co-generation, but in the Department of Energy’s recent Green Power tender invitation provision is made for only 12.5MW of power from biomass.
As far as biofuel is concerned, in September the department issued for comment draft regulations in terms of which it was proposed that 2% of petrol and diesel should consist of biofuel. Government’s existing biofuel strategy, however, excludes established sugar farmers from state aid.
South African Sugar Association executive director Trix Trikam said the average annual sugarcane production of 20m tonnes contains biomass with the energy content of 1.75m tonnes of coal and, if fully utilised, this could generate up to 1 600MW of electricity. An initiative like this could cost R15bn to R23bn.
According to Trikam, there are few industries that can attain as many diverse objectives as a flourishing agricultural processing industry that produces sugar, electricity and ethanol.
Apart from job creation in rural economies and the production of green energy, the sugar industry supports ongoing land reform. Almost 20% of commercial sugar plantations have been handed over to black farmers.
Some of the country’s 14 sugar mills are already producing more electricity than they can use and delivering some 5MW to the national power grid.