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inTouchIssue 3 / 2007An ABB Group publication
Biogas from waste
Antarctica’s Great ObservatoryABB automation products are playing a key role in the first European infrared telescope
An alternative to fossil fuels
Designer buildingsWinding up Impala Platinum’s shaft expansion
Jackina’s joyOpening her heart to orphans of HIV/AIDS
ABB InTouch 3/2007
3 Editorial
4 ABB’s new home at Longmeadow � Groundbreaking ceremony marks start of
construction of state-of-the-art building.
5 New appointments
5 Winding up Impala Platinum’s shaft expansion ABB South Africa has been awarded one
of its largest orders in the mining industry.
6 Designer buildings plug into energy efficiency Rising electricity costs mean architects,
developers and existing property owners
must take power-saving seriously.
9 Antarctica’s Great Observatory
ABB automation products are playing
a key role in the first European infrared
telescope to be deployed in the Antarctic.
10 World’s largest aluminum plant
Power and automation systems will
support greenfield Qatalum project.
11 Leading from the front � Most recent ARC study reports 2006 was
a year of “unprecedented growth”.
12 Sustained growth and increased earnings from 2007 to 2011
� Fred Kindle, ABB President and CEO,
has announced the mid-term strategy for
2007 to 2011.
13 Connecting the world’s largest offshore wind farm
Innovative technology will connect
wind-generated electric power to grid.
13 Power quality system for Kenya
New SCADA control system will
improve power quality and reliability.
14 Jackina’s joy Caring for parents dying of HIV/AIDS
opened Jackina Ramaroka’s heart. She
now runs a programme initiated by Noah
and sponsored by ABB South Africa.
17 Saving lives The three main pillars of ABB South
Africa’s health and safety programme.
18 Saving energy through drive efficiency
19 Biogas from waste Biogas production is rapidly being
established as an alternative to fossil-
based fuels.
In this issue 3 / 2007
Managing Editor:Chesney�[email protected]
Assistant Editor:Tsile�[email protected]
Editor – Power Technologies:Shivani�[email protected]
Editor – Automation Technologies:Ntaga�[email protected]
Contents
In this issue
2
9
14
inTouch
Technology Solutions is published on behalf of ABB South Africa by:
Warp�NineTelephone: +27 11 325 [email protected]
This publication was designed, compiled and produced on behalf of ABB South Africa by Warp Nine. Whilst the compilation and production of ABB inTouch is done with great care and attention and every effort is made to prevent mistakes, neither ABB in Southern Africa nor its principles or subsidiaries, nor Warp Nine accept any responsibility for any errors or the consequences thereof.
ABB South Africawww.abb.com/[email protected]
Telephone: +27 11 236 7000Facsimile: +27 11 236 7001
Address: ABB Park, 3 Eglin Road, SunninghillPostal: Pvt Bag X37, Sunninghill, 2157
ABB InTouch 3/2007
South Africans are caught in an agonising
paradox: while youths and graduates pour
from our schools, colleges and universities
seeking jobs, many are unemployable – because
they simply lack the necessary level of
education or their training is not relevant to the
needs of industry.
ABB is doing its share to overcome this paradox
and beat the shortfall in technical skills.
Engineering students face a different but
equally contradictory challenge: many are well
qualified but can’t find employment because
they lack experience.
Because ABB’s business has grown rapidly
in recent years we have been able to employ
more young engineers than ever before and
we accept that they need to gain experience.
We have begun to promote ABB at universities
to attract more engineering graduates to
our company.
We make sure we develop our young engineers
on the job because it’s important that they gain
the necessary technical competence and
experience for their professional development.
Our recently appointed group talent manager is
assisting in developing and retaining the skills
of both the young and the more experienced.
Government has emphasised that many more
science and maths matriculants and university
graduates are needed to meet the need for
engineers, researchers and technologists. The
challenge of youth employment is greater at the
post-matric and college level. Youth
unemployment tells a worrying story: about
50% of youth (defined in South Africa as
ranging from in age 15 to 35) is unemployed,
and estimated to number about 3.7 million
people – unchanged since 1995. Youth make
up about 70% of the total unemployed in the
country (about six million).
Recognising the high level of skills shortages
and its impact on growth, government and
industry have come together to help Further
Education and Training (FET) colleges make
their curricula more relevant to industry and to
provide learners with workplace experience.
ABB partners with the Swiss South African
Co-operation Initiative (SSACI) to help FET
college students develop their on-the-job-
experience in engineering and related design
at the company. The SSACI FET programme
enjoys the participation of a number of colleges
that require well-supervised workplace-based
experience for students in engineering-related
fields of study.
The FET programme is working to upgrade
college lecturer skills through exposure to
industry-relevant learning methods and up-to-
date technical knowledge. Lecturers attend the
latest engineering courses and seminars at
ABB’s modern training centre in Johannesburg.
ABB also has internal initiatives to create
employment through helping small technical
businesses get established. Our power
technologies business supports small and
medium enterprises in carrying out electrical
wiring and assembly for substation automation,
installation and civil work for substations,
reactive power compensation and series
capacitors projects. In our automation
technologies business, we have established and
developed channel partners who resell ABB’s
wide range of world-class products.
We are trying to ignite the interest of children
in energy efficiency. One way to do this is to
support primary schools by showing the
teachers as well as the children what energy
efficiency really means. We are major
contributors to the World Wide Fund for Nature
Eco-Schools project, which demonstrates solar
power and prompts classes to come up with
their own simple technologies to save electricity.
In the long run, we hope the young minds
exposed to these examples will adopt maths
and science as secondary school subjects and
go on to science careers.
We are committed to technical skills
development because it is important to the
country’s economic future. For ABB, investing
in the future means investing in the youth of
South Africa and skills development.
Carlos Pone
CEO and Country Manager
for ABB South Africa
Investing in the future
Editorial
Carlos Pone
3
4 ABB InTouch 3/2007
Local news
Construction is underway on the new
R300-million state-of-the-art building
that will house ABB South Africa’s head office
and manufacturing and logistics centre in
Longmeadow, Johannesburg.
The start of building operations was marked by a
sod-turning ceremony, with Peter Leupp, ABB
Group Executive Committee Member responsible
for Power Systems, doing the honours.
The new manufacturing, assembly and logistics
centre will house four of the company’s existing
sites in order to optimise processes and
increase efficiencies.
“This move is part of ABB’s continuing
investment in South Africa,” says Carlos Poñe,
CEO of ABB South Africa.
“The new facilities will incorporate many of
ABB’s leading edge technologies in building
automation, lighting and energy efficiency to
provide more modern facilities for production
while offering an improved working
environment for our employees,” says Poñe.
About 1 000 employees from ABB’s Alrode,
Elandsfontein, Midrand and Sunninghill sites
will relocate to the new centre.
Improvon Properties, the premier property
management and development company, will
develop and build ABB’s impressive
consolidated facility. The building is expected
to be ready for occupation in 2009.
“We have partnered ABB for the last nine years,
and we look forward to supplying the company
with a platform which will enable it to continue
its growth into the future,” says Jorge da Costa,
Director of Improvon Group.
ABB builds new home at LongmeadowGroundbreaking ceremony marks start of construction of state-of-the-art building. By Ntaga Mojapelo.
A groundbreaking event: the sod-turning ceremony for ABB South Africa’s new headquarters and manufacturing and logistics centre at Longmeadow, Johannesburg. From left: Carlos Pone, CEO of ABB South Africa; Peter Leupp, ABB Group Executive Committee Member responsible for Power Systems, and Jorge da Costa, Director of Improvon Group.
The site of ABB's new home at Longmeadow, Johannesburg.
ABB South Africa
ABB InTouch 3/2007
Local news
ABB South Africa
5
Winding up Impala Platinum’s shaft expansionABB South Africa has been awarded one of its largest orders in the mining industry. Ntaga Mojapelo reports.
ABB will supply electrical equipment for four
mine winders worth $17-million (R127.5-million)
to Impala Platinum.
The orders involve the supply, installation and
commissioning of control systems, transformers,
Advant Hoist Monitor Systems, AMZ 2000
motors and ACS 6000 drives for the mine
winders for Impala’s two new shafts in the
Rustenburg area, in North West province.
Vast�mining�experience“We are pleased to have been selected to assist
Impala Platinum with these new projects,” said
Carlos Pone, CEO ABB South Africa. “Our vast
experience in mining, coupled with our
advanced technology products, will provide
Implats with the best-suited solutions to realise
their targets for the new shafts.”
Impala Platinum has commenced the sinking of
the new shafts – Shafts 16 and 20; a third –
Shaft 17 – is still in the design phase. The three
shafts are an integral part of the mining group’s
future plans.
The headgear for Shaft 16 is already
constructed. The winders will be installed and
commissioned in 2010.
Impala employs 28 000 people and is one of the
most efficient and lowest-cost primary platinum
producers in the world.
ABB has supplied power and automation
equipment and engineering to the mining
industry in South Africa for many years and for
mine winders since the early 1960s. The
company has also completed projects for new
mine hoists to more than 35 countries around
the world, including China, Canada, Russia,
Sweden, Finland and Australia.
Shiven�Sukraj has been appointed Group Service Manager for ABB South Africa.
Phindo�Mohlala has been appointed Human Resources Director of ABB South Africa.
Francois�Retief has been appointed Division manager of Process Automation for ABB South Africa.
Bongani�Twala has been appointed Division Manager for Robotics, ABB South Africa.
New appointments
Construction work on Shaft 16 began in October 2004. On completion, the concrete headgear will be the tallest in the world at 108m.
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6 ABB InTouch 3/2007
Local news
ABB South Africa
Commerical buildings are going green.
7ABB InTouch 3/2007
The design of office and residential
buildings is undergoing a sea change. As
environmentalism goes mainstream, property
developers and owners want buildings with
less environmental impact and greater degrees
of comfort and “wellness” for people.
ABB’s technologies are assisting in meeting
these new requirements – especially in
providing energy efficiency.
“South Africans have had it good for a long
time with low-priced electricity, but as prices
are expected to rise in the future energy
efficiency is an important issue,” says Liezl Nel,
recently appointed sales engineer responsible
for developing ABB’s building and home
automation business.
Specifically, Nel’s task is to spread knowledge
of ABB’s energy efficiency products, mainly to
the commercial sector but with an increasingly
important spin-off into the residential
environment.
“Our power has been so inexpensive for so
long that, as a country, we’ve paid little heed to
using energy efficiently and thriftily. Today, it’s
a different story. We’re simply going to have to
learn to use power better. Fortunately, there are
modern ways that can help to greatly minimise
the shock, and ABB is moving into this area in
a big way,” says Nel.
Design, power technology and energy
efficiency are key to the new way of
approaching buildings. It’s the EIB (European
Installation Bus) team’s task to put these
elements together and market an innovative
package that looks attractive, is reliable and
delivers optimum energy efficiency.
“In Germany, for example, one way of
achieving energy efficiency is through glass
exteriors, which reflect light inwards or
outwards as needed by manipulating film-
laminated panes to bring sunlight in for heating
or keep it out for cooling,” Nel explains.
“The technology has also reached the stage
where we can combine security and
temperature control into one energy-efficiency
package. And it’s up to customers to decide
how much they want of each. We will custom
design precisely to the customer’s needs.”
Much emphasis is placed on aesthetics in
contemporary building design and technology
is there to assist the EIB team in its
contribution to the architecture.
“No-one need know you’ve introduced a home
or office energy efficiency system,” says Nel,
addressing architects’ and designers’ aversion to
the intrusion of pipes and wires. “Even
retroactive installation can be hidden, seamless
and noiseless, while homeowners and
corporates feel the comfort of the most modern
design and significant money savings.”
Among the latest offerings is a range of radio
frequency products that will soon be
introduced into South Africa. “These have a
seamless design aspect, meaning that even the
most complex and multi-tasked equipment can
be invisible, all controlled by an out-of-the way
console. This is definitely the industry’s future
in South Africa.”
Nel is an interior designer with a background
in office systems for commercial buildings. This
has equipped her for the challenges of power
efficiency management in the energy sector.
“We’re prepared for big growth in our EIB
niche,” she says. “It’s a vital contribution to the
power environment, especially right now.
Energy saving is not something South Africans
are familiar with and it’ll take a lot of educating
on our part to get the energy efficiency story
across. But we will be helped by significant
increases in the electricity bill, sooner rather
than later,” she adds.
“What’s important is that we will be there with
solutions when the cost of electricity becomes
a problem. As important is the fact that ABB’s
energy efficiency installations don’t mean
tearing down half the building to fit them. They
can be installed quite easily, both
retrospectively in existing buildings and in the
design of new ones.”
Many technologies in the ABB product
portfolio can help to achieve various degrees
of energy efficiency in the office and the
home, and more are constantly being added
Designer buildings plug into energy efficiencyRising electricity costs mean architects, developers and existing property owners must take power-saving seriously. By Tom Nevin.
Liezl Nel – promoting energy effiency to commerical and residential building owners.
ABB South Africa
Local news
8 ABB InTouch 3/2007
as the sector expands from niche to fully
fledged industry.
“It’s our task to keep our customers, existing
and potential, well informed and to provide
them with full product knowledge, so they
make the right choices. We don’t supply a one-
size-fits-all package. We provide the solution
companies need for energy efficiency that will
make the difference.”
ABB’s office and home automation systems
control cooling, heating, ventilation, security
systems and even household appliances such as
microwave ovens and music centres.
The challenge of letting the market know that
ABB’s energy efficiency bus is about to hit the
road will involve a flow of information about
its EIB products – through such organisations
as the South African Property Owners’
Association, property management, developers,
designers’ and architects’ associations and
construction firms.
“There are many interesting and intriguing
ways in which buildings can be made energy
efficient. I believe it’s the innovation on the
one hand and the cost saving on the other that
that will make our division a very important
asset to the company,” Liezl says.
A�matter�of�choice�and�aesthetics
In the past, customers largely did not have
much say when it came to making choices
about design elements, finishes and materials in
new commercial buildings and residential home
developments. This is beginning to change:
customers want to be involved in deciding on
the final appearance of their buildings.
“People in South Africa now want safer, better
quality and more aesthetically appealing
electrical wiring accessories,” says Erich
Krause, manager responsible for ABB’s novel
and innovative range of quality wiring
accessories for homes and offices.
“Decorators also have more choice in deciding
on these finishes when they discuss their
preferences with architects, interior designers
and developers,” he adds.
The new range, called ABB WAVE, has been
developed and manufactured for the local
market in collaboration with ABB’s international
design and technology centres in Italy,
Germany, the United Kingdom and China.
Products are made from robust materials that
are colour-fast, UV and weather-resistant,
unbreakable and PVC and halogen-free.
Known in the industry as “wiring accessories”
for home and office electrical systems, the
trend-setting components include such décor
elements as light switches, switch covers, plug
ports and sockets.
Per Wanland, senior vice president for
Automation Products at ABB South Africa, says
that since the company entered the South
African market in 1992 it has focused on
providing products, systems and services to
large electricity utilities and industrial plants. It
decided to introduce electrical wiring
accessories because of the growth in building
development in the country and the
opportunity to provide South African
consumers with more choice.
“We are well known for heavy electrical
engineering in this country but in many parts of
the world ABB is a household name because of
our electrical wiring accessories. ABB is now
offering these products and systems to
residential and commercial building owners in
South Africa,” says Wanland.
ABB South Africa
Local news
Energy efficient systems: powerful but unobtrusive.
ABB InTouch 3/2007
The International Robotic Antarctic Infrared
Telescope (IRAIT) is Europe’s first fully
automated, remotely controlled infrared
telescope and the first to be deployed in what is
widely considered the world’s best observation
site for optical and infrared astronomy.
At the heart of the telescope’s sophisticated
control system is a high-performance ABB
AC31 programmable logic controller (PLC).
The PLC controls critical systems and functions
like system start-up, data collection, heat
regulation, telescope handling, system safety
and power distribution.
ABB was selected by Italy’s University of
Perugia, which is leading the project in
collaboration with the University of Granada
(Spain), Teramo Observatory (Italy) and a
number of other partners. In addition to the
PLC, ABB is also supplying AL contactors (for
power circuit control), circuit breakers and
ACS100 variable speed drives.
Superior technology and extensive technical
support were the main reasons the customer
selected ABB. The products must operate
perfectly in temperatures that range from -30°C
in summer to -80°C in winter. They also have to
be exceptionally robust to withstand the 20-day
journey across 1 200 kilometres of ice in
extreme temperatures before they reach the
assembly site.
The 80-centimetre infrared telescope will
commence operations later this year at
Concordia, Europe’s first permanent research
station in Antarctica. Concordia was established
in 2005 by Italy and France on Dome C of the
Antarctic Plateau, some 1 200 kilometres inland.
Dome C is one of the three highest peaks on
the plateau, 3 200 metres above sea level.
If the IRAIT project succeeds as expected,
Concordia is expected to become the site for a
so-called Great Observatory, dedicated to
infrared and very high angular resolution
observations of planets, stars and galaxies
beyond our solar system. The exceptional cold,
low brightness in the sky and minimal water
vapour in the atmosphere at Dome C make it
ideal for infrared astronomy.
ABB is playing a key role in the first European infrared telescope for the Antarctic.
A view of the mountains in Antarctica.
The Dome C base. IRAIT is scheduled to make its first observations later this year during the Antarctic summer.
Antarctica’s Great ObservatoryABB automation products are playing a key role in the first European infrared telescope to be deployed in the Antarctic. The project is the first step towards the creation of a “Great Observatory” at the world’s foremost astronomical observing site.
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Global news
ABB International
9
10 ABB InTouch 3/2007
ABB, the leading power and automation
technology group, was awarded a $140-million
contract by Qatalum, a joint venture between
Qatar Petroleum and Norway’s Hydro
Aluminum. The partners are constructing what
will be the world’s largest aluminum plant built
in one phase in Qatar.
ABB will supply a high-voltage power rectifier
station consisting of 10 high-current rectifiers
rated at 1750 volts, 10 regulating and rectifier
transformers, System 800xA control and
protection systems, two SCADA (supervisory
control and data acquisition) systems, two
direct-current measuring systems and various
auxiliary systems. ABB will also provide high-
voltage cabling, engineering, training,
installation and commissioning.
“This milestone project reflects our extensive
expertise and experience in the primary metals
and minerals industries,” said Veli-Matti
Reinikkala, head of ABB’s Process Automation
division. “By combining standard ABB products
and systems with industry-specific knowledge,
we have established a strong track record for
meeting customers’ needs in terms of
productivity, reliability and energy efficiency.”
The greenfield Qatalum project will include an
aluminum smelter with a capacity of 585 000
tons per year, and a dedicated 1 350-MW power
plant station to ensure a stable supply of
electricity. The smelter will be located in the
Mesaieed Industrial City, about 40 kilometres
south of the Qatar’s capital, Doha, near a
natural bay on the southern coast of the Qatar
Eastern Peninsula.
ABB is a world leader in advanced solutions for
aluminum smelting, and has equipped an
estimated 80% of the smelting facilities in the
Gulf region. Deliveries to the Qatalum site will
begin in the fourth quarter of 2008, with metal
production set to commence in late 2009. The
order was booked at the end of the second
quarter 2007.
World’s largest aluminum plantPower and automation systems will support greenfield Qatalum project.
Global news
ABB International
Dhows tied up in the Dhow Harbour, Qatar, with the national flag flying from one of their stern flagstaffs.
The Qatari peninsula juts 160 km into the Persian Gulf from Saudi Arabia.
ABB InTouch 3/2007 11
In a recently published study titled
“Distributed Control Systems Worldwide
Outlook”, industry analyst ARC Advisory Group
ranked ABB in the leading worldwide market
position in this core automation market.
The study reports that the total worldwide
market for DCS (distributed control systems)
increased by 14% between 2005 and 2006, with
total revenues of $13.4-billion, and forecasts that
the compound annual growth rate for this
market through 2011 will be 9.9%.
The ARC report states that the DCS market is a
leading indicator of the overall health of the
process automation business; overall growth in
2006 exceeded ARC’s expectations. Factors
contributing to this upward trend include high
energy prices and the growing worldwide
demand for energy, as well as the continued
need by manufacturers to improve their plant
operations, meet increasing regulatory
requirements, and modernise the aging installed
base. ARC estimates the total installed base of
DCS systems worldwide to be over $65 billion.
“The rapid growth of the DCS market, and the
battle for the installed base, make it no easy
task for the market leader, but ABB still retains
its leading position in the worldwide market for
2006. The company continues to enjoy the
largest installed base of any supplier, and is
making key strides in evolving its installed base
forward to its System 800xA platform,” said
Larry O’Brien, Research Director for Process
Industries, ARC.
“ABB is also the market share leader in key
global verticals including oil and gas, electric
power, cement and glass, and pulp and paper
and the regional leader for Europe/Mid East/
Asia (EMEA).”
The oil and gas, refining and power industries
superseded the pharmaceutical and food and
beverage industries as the fastest growing DCS
markets in 2006, providing new areas of
opportunity across all geographies. ARC
forecasts that oil and gas will see more growth
in the DCS market than any other industry area
over the next five years. This growth will be
driven by increasing investments in oil
exploration and production.
“ABB’s strong presence in the oil and gas
market, and vast portfolio of technology and
expertise, will help us to serve our current and
future customers in this growing market space
with the solutions they need to be successful,”
said Veli-Matti Reinikkala, head of ABB’s
Process Automation division.
ARC says Asia is still a powerhouse and
opportunities continue to abound in the Middle
East, Eastern Europe, and Latin America, but the
developed markets such as North America and
Western Europe are beginning to show signs of
sluggishness. ARC expects the current growth
phase of the global market for automation to
last through the next several years.
China is still the primary catalyst for global
growth in the automation industry. As a result,
ARC expects that China will be the single
biggest geographical market for automation
products and services in 20 years.
Leading from the frontMost recent ARC study reports 2006 was a year of “unprecedented growth”.
Expert�industry�knowledge
Founded in 1986, ARC Advisory Group has
grown to become the thought leader in
manufacturing and supply chain solutions.
ARC analysts have the expert industry
knowledge and first-hand experience to help
clients find the best answer to complex
business issues. ARC focuses on simple yet
critical goals: improving clients’ return on
assets, operational performance, total cost
of ownership, project time-to-benefit, and
shareholder value. Additional information on
the Distributed Control Systems Worldwide
Outlook, as well as other studies on the
global automation market, is available at
www.arcweb.com.
Global news
ABB International
High energy prices and plant efficiency are driving the market for control systems.
12 ABB InTouch 3/2007
ABB expects sustained revenue growth and
increased profitability under its new mid-term
strategy for 2007 to 2011. The group anticipates
demand for new and upgraded power
infrastructure to continue in all regions, and
further industrial investments in improved
productivity and energy efficiency.
The company plans to maintain its current core
portfolio of businesses and aims to build on its
leading technology and strong market positions
– especially in the fast-growing emerging
economies – to increase revenues organically at
almost twice the rate of market growth and
three times the rate of global GDP growth over
the period.
Assuming demand remains favorable, ABB
expects profitability (measured as earnings
before interest and taxes as a percentage of
revenues) to increase by as much as five
percentage points during the five-year period,
compared to 2006. The improvement will be
driven by economies of scale, such as strong
factory loading, and further operational
improvements.
As a result, the company forecasts earnings per
share to grow by a compound average of 15-20%
a year over the planning period and its return
on capital employed, after tax, to exceed 30%
by 2011. “ABB’s market and technology
leadership in highly attractive businesses
provides an opportunity to achieve sustainable
organic growth and increased profitability,” said
Fred Kindle, ABB President and CEO, in
announcing the group’s new strategy.
“We will continue our focus on business execu-
tion and operational excellence,” Kindle said.
“Initiatives to optimise our global footprint will
continue to bring both cost and growth benefits.
At the same time, we will look for value-creating
external growth opportunities. We expect our
shareholders as well as our other constituencies
to directly benefit from this strategy.”
The previous EBIT margin target, which was to
be achieved by the end of 2009, has been
replaced with an EBIT margin corridor providing
a minimum and maximum value for each year in
the 2007-11 period, depending on market
conditions. The previous net margin target has
been replaced by a compound annual growth
target for undiluted earnings per share.
The company said its existing portfolio of power
and automation businesses, and its leading
presence in high-growth emerging markets, puts
it in a strong position to benefit from expected
continuing growth in power utility and industrial
automation investments over the next five years.
These favourable trends will be further enhanced
by the accelerating drive for energy efficiency
and efforts to combat climate change.
From 2007 to 2011, global GDP is expected to
grow by an average of about 3% a year, while
ABB forecasts its markets will grow at
approximately 6% a year. The Asian market is
expected to grow by more than 50% by 2011,
with Europe up 24%, the Americas 25%, and the
Middle East and Africa 40%.
ABB continues to assess potential acquisitions
that fill technology or regional gaps, create
strategic and financial value and can be
successfully integrated. The company’s growth
and profitability targets exclude the effect of
major acquisitions.
Investments in technology and R&D will
continue to be a pillar of strategy.
ABB will continue to drive its global footprint
initiative aimed at aligning the geographic scope
of its engineering, manufacturing and supply to
rapidly changing market conditions. The
company increased sourcing from emerging
economies to more than 30% of total sourcing
by the end of the first half of 2007, compared to
less than 18% in 2005, and low-cost sourcing
can increase further.
SuMMARy�oF�2007�11�gRouP�TARgETS
Revenue growth 8-11% CAGR2
EBIT margin corridor 11-16%
Earnings per share growth 15-20% CAGR2
Return on capital employed (after tax) (ROCE)
>30% by 2011
Free cash flow as share of net income (cash conversion)
100% on average
Global news
Sustained growth and increased earnings from 2007 to 2011ABB’s leading power and automation technologies enable utility and industry customers to improve performance while lowering environmental impact. The group operates in around 100 countries and employs about 111 000 people. In September, Fred Kindle, ABB President and CEO, announced the mid-term strategy for 2007 to 2011.
ABB International
Fred Kindle.
Compound annual growth rate over five years from 2007 to 2011 (base year is 2006), excluding major acquisitions and divestitures and assuming constant exchange rates.
ABB InTouch 3/2007
Global news
Power quality systems for KenyaNew SCADA control system will improve power quality and reliability.
ABB has signed a $25-million contract with
Kenya Power & Lighting Co (KPLC) to upgrade
and expand the system that controls Kenya’s
power transmission network and the
distribution network in the capital city of
Nairobi. ABB supplied the original SCADA/EMS
System (Supervisory Control and Data
Acquisition/Energy Management System) 20
years ago and has also been the major supplier
of utility communication equipment to KPLC
over the last 30 years.
“We are very pleased to be able to continue to
work with KPLC on improving the quality,
reliability and security of the electricity supply
in Kenya,” said Peter Leupp, head of ABB’s
Power System division.
The control system will comprise five control
centres, in Nairobi and around the country,
equipped with redundant computer systems and
ABB Network Manager SCADA/EMS software
for the operation, control, analysis and
enhancement of the electrical network, and for
power generation management.
To enable the reliable operation of the control
system, the centres will be linked to more than
90 substations and power stations by more than
1300 kilometres of OPGW (Optical Ground
Wire), ABB FOX 515 multiplexers, ABB ETL 600
Digital Power Line Carrier (DPLC) and radio
communications.
Maintaining power delivery as load increases in
the morning, keeping it within security limits
during daily peaks, and managing load
decreases at night are just some of the tasks the
control system will perform. During unplanned
disturbances, preparedness is vital in order to
avoid large-scale outages, make rapid analysis
and re-establish power supply.
ABB has won an order worth more than
$400-million from the German utility
E.ON Netz GmbH to supply the power
equipment that will connect the world’s
largest offshore wind farm to the
German grid.
ABB will connect the 400-megawatt
(MW) Borkum-2 park using its
innovative and environmentally
friendly HVDC Light (high-voltage
direct current) transmission
technology, which gives utilities
complete control over the power
supply and increases grid stability.
Located more than 100 kilometers off
the German coast in the North Sea, the
wind farm will be the most remote of its kind
in the world.
“Linking renewable sources of power to the grid
can be challenging due to environmental
conditions and the distance involved,” said Peter
Leupp, head of ABB’s Power Systems division.
“This project highlights how renewable power
sources can be integrated to help combat
climate change.”
Scheduled to be operational in September 2009,
the wind farm is expected to avoid CO2
emissions of 1.5 million tons per year by
replacing fossil-fuel generation. Germany
currently uses wind for about 7% of its
electricity requirements and expects to double
the share of wind energy by 2020.
ABB is responsible for system
engineering including design, supply
and installation of the offshore
converter, sea and land cable systems
and the onshore converter. Most of the
transmission system provided by ABB
will be laid underwater and
underground, thus minimising
environmental impact.
HVDC Light offers numerous other
environmental benefits, such as neutral
electromagnetic fields, oil-free cables
and compact converter stations, and is
ideal for connecting remote wind farms
to mainland networks without distance
limitations or constraints on the grid.
ABB is the world’s largest supplier of electrical
products and services to wind turbine
manufacturers. The group’s wind power
business grew on average by more than 50% a
year over the last three years and in 2006
generated revenues of more than $500-million.
Connecting the world’s largest offshore wind farmInnovative technology will connect wind-generated electric power to grid.
ABB will connect the 400-megawatt (MW) Borkum-2 park using its innovative and environmentally-friendly transmission technology.
ABB International
13
14 ABB InTouch 3/2007
Jackina Ramaroka, a 40-year-old resident of
the informal township of Ivory Park, near
Johannesburg, has sadness in her voice when
she recalls her door-to-door visits to shacks
where people were bed-ridden with HIV/AIDS.
Amid poverty and suffering, she witnessed
many children being orphaned as their parents
died from the disease.
We have come to visit Jackina, driving to Ivory
Park from Sunninghill, Johannesburg, along
the paved highway and secondary roads. On
entering the township, we hit bumpy tarred
streets. Taxis, bakkies, light trucks and cars
jam the busy roadway. Tiny homes made of
large grey bricks, horizontal wooden planks
and rusty corrugated iron roofs flash past.
Sidewalk informal traders selling fruit, cool
drinks and fast foods dot both sides of the
long main road. After several twists and turns,
we find the Ivory Park Eco Village community
centre, where the new Noah “ark” resource
centre is temporarily located until more
suitable premises can be found – and where
Jackina is the manager.
In a small peach-painted building in the centre,
Noah staff are getting ready for the children
who will be visiting after school. Pieces of
frozen chicken thaw in the sunlight streaming
through the uncurtained window. A large pot
stands empty on a gas stove. These are last-
minute preparations for the meal of the day.
When the children stream in from the street,
they are treated to a nutritious meal.
Later, the aftercare activities begin: drama,
poetry, arts and crafts and traditional dancing.
For a few hours, the children play and have fun.
Some are able to experience the joy of having
the burden of domestic responsibilities lifted
from their shoulders.
We sit in the cool of the small room with
bright blue walls. An earthy smell wafts into
the room from the large food garden outside.
The staff chat to the visitors about how they
have been looking after the children during
the winter months.
“Before we established the Noah ark, most of
the children could not be properly cared for
and fed,” Jackina says. “The worst case I saw
was two boys, one 16 years old and the other
12, living alone after being orphaned in a shack
that was falling to pieces. The door had fallen
off; they had no food and no blankets. It was
very painful for me to see these boys living like
this. Children are so helpless.”
As she continued with her work for Jozi
Hlomile, a social services organisation with the
Gauteng Provincial Health Department, Jackina
became more aware of the many children
Caring for parents dying of HIV/AIDS in Ivory Park opened Jackina Ramaroka’s heart to the orphans left behind, many of whom had to fend for themselves. She now runs a programme for orphans of AIDS initiated by Noah and sponsored by ABB South Africa. By Chesney Bradshaw.
Jackina’s joySustainability
Jackina Ramaroka.
Sponsorship
Steps�to�building�an�ark
When Noah establishes an ark in a community, it
follows six steps that the organisation has learnt
over time increase the chances of success.
Tracy Kruger, head of fundraising for Noah, ran
through the stages when we visited Ivory Park to
see the new ark being established in the
community. This ark is being supported by ABB
South Africa. The introductory steps are:
1. Register the children on the Noah database
and assist them to obtain birth certificates and
identity books.
2. Work with the Department of Social
Development to obtain grants for the families.
3. Establish a food garden to feed the children,
give them food parcels to take home where
needed and, where a large food garden has
been set up, sell the excess vegetables to the
community to generate income.
4. Prepare nutritious meals daily for the children.
5. Offer psychosocial support. Ark staff visit the
children at their homes to make sure they are
being cared for; when support is not evident,
they arrange for community members to take
them in.
6. Establish a Noah resource centre – a shack,
building or container, depending on funding.
This structure provides a base for caring for
children and provides pre-school and aftercare.
ABB InTouch 3/2007
being orphaned in her community. Their
distress prompted her to start an informal
feeding scheme.
“When their parents die, these children are left
behind, often with nothing,” Jackina says. “We
started feeding them bread. It was really basic
until we contacted Noah (Nurturing Orphans of
AIDS for Humanity) early this year and asked
them to help us.”
After consultation with the community, Noah
established a feeding and support programme
for about 150 orphans in Ivory Park’s Ward 77
in March this year. It had already established its
first ark – a community network to provide care
services for orphans of HIV/AIDs – in the
township known as “Ivory Park 1”, Ward 78.
“This ark was run very informally at first but
there is such a need for Ivory Park 2 to be
extended because these children must have
support,” says Tracy Kruger, head of fundraising
for Noah.
“What you see here is a very humble ark with
no infrastructure, no set-up and very little
ability to care for children. What we will do
now is bring in donors and an organisation that
can adopt the ark.”
Martha Matlala, the cook at the ark, says: “I’ve
come to help here because many children don’t
have parents. Before, the children were
suffering because they didn’t have food, clothes
or school uniforms. Now they don’t have to stay
inside their shacks all day with nothing to eat.
They can come here for food and help. Many of
the grandmothers who take care of them are
too old to cook and are bedridden. It’s difficult
for them to help the children.”
Monica Zeka, a volunteer from the community,
says: “I help these children because many of
them have to be the head of their families after
their parents die. They have no-one to turn to.”
Olga Sobekwa, the cleaner at the ark, says she
wants to see the Noah initiative grow. “This
Challenging factsIt is estimated that by 2050 the AIDS pandemic will be the most significant factor shaping the forthcoming century. According to the Actuarial Society of South Africa and the HSRC, South Africa is one of the most severely AIDS-affected countries in the world.
In Africa, a high risk of exposure to TB and other infections, aggravated by the lack of adequate treatment, makes the transition from HIV infection to death rapid.
Many parents with AIDS are dying before their children reach adulthood, which means South
Africa is increasingly becoming a country populated by orphans. There are currently an estimated 1.5 million orphaned children in South Africa, and the number is expected to peak at 2.5 million by the year 2015. These children will make up 10% (or more) of the total population by 2020.
We have no idea what it will be like to live in a country where a significant proportion of the people have had to sacrifice childhood innocence to fend for themselves. Having no family or cultural value system, these children will fail to remember the safety and nurturing of their mother’s arms. These are our children. Source: Noah
Sustainability
Nutrition and care – important for young developing minds.
Sponsorship
15
16 ABB InTouch 3/2007
place is too small. I’d like us to have more space
to prepare food and for the children.”
The search is on for larger premises, says Tracy.
“We expect more children. The number of
children could increase to about 500.”
Noah’s aim is to try to help the large number of
children orphaned by Aids in South Africa to
mature into emotionally and psychologically
stable adults capable of forming lasting and
loving relationships, of being nurturing parents
to their own children and responsible and
participative citizens of South Africa. It already
cares for 33 000 AIDS orphans.
The organisation’s strategy is premised on the
understanding that the key to success lies in a
group effort from the community. The sheer
number of orphans precludes traditional
charitable or institutional models of care. Only a
model rooted in teaching and empowering
communities to care for the own orphans has
any chance of being sustainable, and of being
scaled to the size required.
Joseph Malapile, an advice officer with the
Greater Midrand Development Centre, drops in
to visit the Noah ark as part of his organisation’s
effort to meet the psychosocial needs of the
children – as well as the larger community. He
says members of the community initially resisted
the idea of establishing an ark because they did
not know what it was all about. “Community
involvement is important in projects like this. In
the beginning, the community did not respond
positively because they did not know what Noah
was going to do. Noah staff and volunteers went
out into the community to encourage the
children to come here.”
“We mobilise an ark in the community by
establishing a committee that includes
community leaders such as a teacher, minister
and school principal,” Tracy says. “If you don’t
have buy-in from the community, they will reject
your initiative. Our role is to identity the children
who should come here and to let them know
that it is safe to do so. We want them to know
that there is hope here.”
“A big issue can be the stigma attached to
being an orphan,” adds Tracy. “Children often
don’t want other people to know they are
orphans, and are especially sensitive as they
get older because other children tease them.
For example, if they don’t have a school
uniform, everyone knows they are an orphan
and they get teased. So some don’t go to
school. Keeping orphans of AIDS in school is
very important.”
“Before we only had a broken table with bread
for the children,” Joseph says, his expression
troubled as he tells this part of his story. “But the
facilities have improved and the children are
coming. We’ve turned the corner.”
Jackina is pleased with how the Noah facility is
progressing, and she hopes larger premises will
soon be found. She is especially happy about
how things have turned out for the two teenage
boys she found abandoned.
“I’ve talked to a ward councilor who has donated
a Zozo (shack) for the children,” Jackina says.
“They come to the Noah centre for food. Things
have worked out well for them. My passion is to
work with these children. As long as I can make
them happy, I am happy.”
ABB�South�Africa�funds�the�Noah�Ivory�Park�2�
ark,�as�well�as�arks�in�gauteng�and�KwaZulu-
Natal.�ABB�supports�more�than�1�000�children�
orphaned�by�HIV/AIDS�throughout�the�country.
Sponsorship
Sustainability
From�left�to�right: Julia Maelane child supervisor and Martha Matlala, cook.
Why�the�need�for�a�novel�solution?
The sheer size of the AIDS orphan challenge
rules out many of the seemingly obvious
responses.
If we build accommodation for even half of
these children, the cost will be between R20-
billion and R40-billion.
If we set up a government or non-governmental
structure to run an organisation to care for all
the children it will require about 80 000
administrative staff.
If we give each child just two hours a month of a
social worker’s time, to counsel, support or
simply to hug them, we will need an additional
40 000 social workers. (There are currently just
9 000 registered social workers in South Africa.)
Just giving out food parcels to feed this number
of children will be a major logistical and financial
challenge and will create dependency.
Only a model rooted in empowering
communities to care for their own orphans and
vulnerable children has any chance of being
scaled to the size required.
Source: Noah. Visit www.noahorphans.org.za
for more information.
17ABB InTouch 3/2007
Health and safety
Training
ABB South Africa runs a comprehensive
awareness programme that ensures all
employees are health and safety conscious.
There are three pillars to the health and
safety programme for South Africa and
sub-Saharan Africa.
The first pillar is the “Seven steps that
saves lives” checklist, aimed at employees
who work in the electrical engineering field
and who are exposed to more than 1Kv
of electricity.
“Project safety management” is the second
pillar, aimed at project and contract engineers
and contract and site managers. The purpose
of this training is to ensure a safe working
environment from a project’s pre-commission
stage all they way through to implementation.
There are many risks that need to be taken
into account, such as climate changes and
lifecycle factors.
Safe�on�the�roadThe third pillar is a drive to ensure road safety.
Project engineers and site managers, for
example, travel substantial distances in the
course of their jobs and we need to know that
they are safe on the road.
Safety observation is an overarching support
for the three pillars. Four trained employees
are responsible for monitoring the effectiveness
of the health and safety programme and
conduct regular site visits.
The road safety training is still in process,
while “Seven steps that saves lives” and
“Project safety management” training was
completed in 2006.
This year, new employees that work in the
target areas are attending training courses,
while in future programmes will be rolled out
every two years as a refresher course.
ABB’s management is firmly committed to
health and safety in the workplace on a global
level. As part of this commitment, occupational
health and safety advisers will attend custom-
made, one-on-one training to ensure their
competencies match the risk profiles and
environments where they work.
Seven�steps�that�save�lives Project�safety�management ABB�road�safety
15 subject specialists trained 9 subject specialists trained 15 subject specialists trained
142 people involved in electrical engineering projects greater than 1kV trained
195 project engineers, contract engineers, site and contract managers trained
334 staff driving substantial distances are being trained on the Audi South Africa Driving Course and the BMW South Africa Advanced Driving Course
Safety�observation4 employees identified to monitor effectiveness of training
Saving livesABB South Africa’s health and safety programme has three main pillars, explains the Country Occupational and Health and Safety Adviser for South Africa and sub-Saharan Africa. By Marius Snyman.
A comprehensive awareness campaign ensures all employees are health and safety conscious.
Of all resources on which modern manufac-
turing is dependent, energy is arguably
the most fundamental. It is also a resource that
has long been taken for granted. Rising energy
prices and concerns over greenhouse gas emis-
sions are increasingly leading operators to criti-
cally assess their energy usage.
In many sectors, the potential for energy
savings is minor and gains of a couple of
percent in terms of energy efficiency are
celebrated as breakthroughs. Under such
conditions, the prospects of achieving major
energy savings seem bleak. There are
technologies, however, that can deliver very
significant reductions. Foremost among these is
a device that – at first sight – lacks the
spectacular note of high-power, high-volume
processes. It doesn’t make much noise or
develop extreme temperatures or go through
complex motions. In fact it sits in a cabinet and
usually doesn’t even get a mention when the
overall process is explained. However, it can cut
energy consumption by 42 percent, and if
applied in all relevant plants worldwide, it can
deliver energy savings that equate to the
electrical consumption of a country such as
Spain. This device is the drive.
The principle is simple: In the past, the motors
that powered pumps were usually run at full
power all the time, with the regulation of output
being achieved through valves. A drive regulates
flow through direct control of the electrical
power fed to the motor, so permitting friction-
based controls and the associated losses to be
dispensed with. The following stories provide
insight into several applications and show how
drives technology can and do make a difference.
Saving energy through drive efficiencyPer�Wikstroem,�Jukka�Tolvananen,�Akseli�Savolainen,�Peter�Barbosa.
ABB inTouch 3/200718
Technology
Energy
19ABB InTouch 3/2007
Biogas from waste
Two interesting biogas facilities were taken into production in Sweden in late 2006. The cities of Boras and Gothenburg are leading the battle against global warming by powering their fleets of trucks, buses and other vehicles with bio methane produced from the mixed refuse from domestic and industry’s dustbins. The increas-ing interest in reducing carbon diox-ide emissions in the transportation sector has created opportunities and incentives to convert to “green” cars using tax and duty reductions includ-ing free parking in the big cities of Sweden. Biogas production is rapidly being established as an alternative to fossil-based fuels.
The processes used in these two cases are supplied by Läckeby
Water, a privately held company from southern Sweden. The equipment pro-vided by this company consists of drum sieve modules, heat exchangers, filters, decanters and sand washers. These are combined into a process tailored to match the specific require-ments defined by the available input mixture. The produced biogas is cleaned by the special Cooab tech-nique, which emits as little as 0.1 per-
cent of the methane into the atmo-sphere (other methods release two to four percent). Besides the reduction in greenhouse gas emissions, this means that more energy is converted into useful biogas.
The Boras and Gothen-burg installations will, at full production, produce 25 GWh and 60 GWh per year respectively.
ABB’s involvement with these two facilities consists of the supply of the automation system and electrical equipment such as motors, drives and switchgears. Through its participation in biogas projects of this type, ABB’s engineers have developed know how that can be packaged into modular applications for reuse. Today, Sweden is the world leader in bio methane production for vehicles, hence appli-cation know how is at the forefront of development.
The Boras and Gothenburg installa-tions will, at full production, produce 25 GWh and 60 GWh per year respec-tively, with that at Gothenburg repre-senting the world’s largest facility for biogas. Gas from the decomposition of biological refuse is washed and cleaned to provide bio-methane for the municipality’s vehicle fleet. The corresponding reduction in CO
2 emis-
sions is estimated to be more than 20,000 tons annually.
The process supplier, Läckeby Water, has supplied 4000 projects of different magnitudes to 68 countries around the globe. Encouraged by tax incentives, the sale of biogas-powered cars in-creased by 50 percent in 2005 growth that creates new opportunities for Läckeby Water and ABB. It is estimat-ed that further installations in Sweden will, by 2020, create employment for 60,000 people, which equates to the manufacturing jobs lost during the last five years. This expansion is hence both environmentally and politically rewarding.
Nils Leffler
The Sobacken generation 2 biogas plant
fluid organic waste
source-separatedhousehold waste
pre-treatment bioseparator 1
buffer 1
fluid organic waste
Buffer 2
heatexchanger
bioseparator 2
solidwaste
screwconveyers
hygienisation
digester
heatexchanger
compressor cooler
compostSBR plant
digestatebuffer
heatexchanger
centri-fuge reject
buffer
process water
biogas
63ABB Review 2/2007
Shades of green
Alternative energies
Technology
Biogas from waste
The processes used in these two cases are
supplied by Läckeby Water, a privately held
company from southern Sweden. The
equipment provided by this company consists
of drum sieve modules, heat exchangers, filters,
decanters and sand washers. These are
combined into a process tailored to match the
specific requirements defined by the available
input mixture. The produced biogas is cleaned
by the special Cooab technique, which emits as
little as 0.1 percent of the methane into the
atmosphere (other methods release two to four
percent). Besides the reduction in greenhouse
gas emissions, this means that more energy is
converted into useful biogas.
ABB’s involvement with these two facilities
consists of the supply of the automation system
and electrical equipment such as motors,
drives and switchgears. Through its
participation in biogas projects of this type,
ABB’s engineers have developed know how
that can be packaged into modular
applications for reuse. Today, Sweden is the
world leader in bio methane production for
vehicles, hence application know how is at the
forefront of development.
The Boras and Gothenburg installations will, at
full production, produce 25 GWh and 60 GWh
per year respectively, with that at Gothenburg
representing the world’s largest facility for
biogas. Gas from the decomposition of
biological refuse is washed and cleaned to
provide bio-methane for the municipality’s
vehicle fleet. The corresponding reduction in
CO2 emissions is estimated to be more than
20,000 tons annually.
The process supplier, Läckeby Water, has
supplied 4000 projects of different magnitudes
to 68 countries around the globe. Encouraged
by tax incentives, the sale of biogas-powered
cars increased by 50 percent in 2005 growth
that creates new opportunities for Läckeby
Water and ABB. It is estimated that further
installations in Sweden will, by 2020, create
employment for 60,000 people, which equates
to the manufacturing jobs lost during the last
five years. This expansion is hence both
environmentally and politically rewarding.
Nils [email protected]
Two interesting biogas facilities were taken into production in Sweden in late 2006. The cities of Boras and Gothenburg are leading the battle against global warming by powering their fleets of trucks, buses and other vehicles with bio methane produced from the mixed refuse from domestic and industry’s dustbins. The increasing interest in reducing carbon dioxide emissions in the transportation sector has created opportunities and incentives to convert to “green” cars using tax and duty reductions including free parking in the big cities of Sweden. Biogas production is rapidly being established as an alternative to fossil-based fuels.
The Sobacken generation 2 biogas plant.
Energy
Enabling the power of wind
ABB innovation and experience can help.ABB’s environmental friendly VSC (Voltage Source Converter)
based HVDC Light underground/subsea transmission system
system facilitate grid connections in remote areas without
the need for grid reinforcements. As the HVDC Light system
can control both active and reactive power simultaneously
and independently from each other it will comply also with
very strict Grid Codes. With its oil-free and flexible cables long
underground connections are possible. Contact ABB to learn more of its new technologies,
replacement generators, and other energy efficient and reliable products and services
for the wind power market.
Visit us at www.abb.com/windpower and www.abb.com/hvdc
© Copyright 2007 ABB