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Get a share of solar

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FedGroup has recently launched its shared ownership system where investors receive a physical asset to generate income.

Independent financial services provider FedGroup has launched a shared ownership system as part of its effort to disrupt traditional approaches to wealth creation. Unlike traditional wealth creation approaches, where money is invested, this model involves the ownership of a physical asset to generate income.

The first project under this banner allows members of the public to own one or more solar panels that form part of a larger solar facility, located on the roofs of commercial and industrial buildings. The panels can be purchased on FedGroup’s online platform and are then installed on suitable sites, with the owners receiving a monthly rental income based on the power generated by the panels. FedGroup then collects and pays over the rental income to the panel owners.

The direct ownership network operates on the peer-to-peer model, where the landlords of sites, the providers and installers of the solar panels, and those wishing to own the panels are connected.

“FedGroup is always looking to implement the latest technology to drive down fees and maximise returns for our clients,” says Grant Field, CEO of FedGroup. “Therefore, introducing direct ownership for wealth creation to the South African market is a logical progression in terms of our product offering. Through the use of technology, we are able to actively track the performance of the panels, which translates into money generated for the owner.

“Our pilot project indicates that panel owners can expect to receive an internal rate of return on the purchase price in excess of 11% per annum, over the 20-year lifespan of the project. Because it is a green project, they can also apply for tax benefits, to further boost their returns. At the end of the 20-year term, owners can take physical ownership of the panel, or sell it back at a guaranteed residual value of R1 000.”

While the buyer owns the asset, FedGroup is tasked with the management, maintenance, insurance and optimisation of the panels.

“Because the rental income is calculated according to the performance of the panels, they would produce more on sunny days than on cloudy ones, but the sunny South African climate and our particularly high irradiance levels add to the profitability of this project,” says Field. “The returns are secured through a contract with the building owner to pay a monthly fee, determined by the amount of electricity generated. The money collected from the building owner every month is then distributed to the owners.”

Owners are able to track the performance of their panels online at any time. Because the panels are physically owned, FedGroup will soon be introducing a convenient secondary market to provide liquidity for anyone wishing to sell their solar asset.

The installation of solar panels also has several advantages for building owners, particularly in the case of older buildings, as many of them still bear the legacy of being energy inefficient, having been built at a time when electricity was cheap. Through this initiative, building owners now have an added incentive to retrofit their buildings with energy-efficient technology and turn the unused space on their roofs into profitable assets.

In addition to solar panels, FedGroup is also in the process of bringing other direct ownership opportunities to market.

“Each project is chosen on merit,” says Field. “We chose solar generation as our first project because we recognised the trend towards environmental sustainability in consumers’ purchasing behaviour. In addition, consumers understand solar power generation, making it a suitable product for the introduction of the concept of direct ownership.

“The beauty of the direct ownership model is that it can be applied to an almost limitless array of underlying assets, and we have a number of very exciting projects in the pipeline,” says Field. “While the asset being sold will differ, the model of direct ownership for wealth creation will remain consistent.”

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Smart home arrives in SA

The smart home is no longer a distant vision confined to advanced economies, writes ARTHUR GOLDSTUCK.

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The smart home is a wonderful vision for controlling every aspect of one’s living environment via remote control, apps and sensors. But, because it is both complex and expensive, there has been little appetite for it in South Africa.

The two main routes for smart home installation are both fraught with peril – financial and technical.

The first is to call on a specialist installation company. Surprisingly, there are many in South Africa. Google “smart home” +”South Africa”, and thousands of results appear. The problem is that, because the industry is so new, few have built up solid track records and reputations. Costs vary wildly, few standards exist, and the cost of after-sales service will turn out to be more important than the upfront price.

The second route is to assemble the components of a smart home, and attempt self-installation. For the non-technical, this is often a non-starter. Not only does one need a fairly good knowledge of Wi-Fi configuration, but also a broad understanding of the Internet of Things (IoT) – the ability for devices to sense their environment, connect to each other, and share information.

The good news, though, is that it is getting easier and more cost effective all the time.

My first efforts in this direction started a few years ago with finding smart plugs on Amazon.com. These are power adaptors that turn regular sockets into “smart sockets” by adding Wi-Fi and an on-off switch, among other. A smart lightbulb was sourced from Gearbest in China. At the time, these were the cheapest and most basic elements for a starter smart home environment.

Via a smartphone app, the light could be switched on from the other side of the world. It sounds trivial and silly, but on such basic functions the future is slowly built.

Fast forward a year or two, and these components are available from hundreds of outlets, they have plummeted in cost, and the range of options is bewildering. That, of course, makes the quest even more bewildering. Who can be trusted for quality, fulfilment and after-sales support? Which products will be obsolete in the next year or two as technology advances even more rapidly?

These are some of the challenges that a leading South African technology distributor, Syntech, decided to address in adding smart home products to its portfolio. It selected LifeSmart, a global brand with proven expertise in both IoT and smart home products.

Equally significantly, LifeSmart combines IoT with artificial intelligence and machine learning, meaning that the devices “learn” the best ways of connecting, sharing and integrating new elements. Because they all fall under the same brand, they are designed to integrate with the LifeSmart app, which is available for Android and iOS phones, as well as Android TV.

Click here to read about how LifeSmart makes installing smart home devices easier.

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Matrics must prepare for AI

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students writing a test

By Vian Chinner, CEO and founder of Xineoh.

Many in the matric class of 2018 are currently weighing up their options for the future. With the country’s high unemployment rate casting a shadow on their opportunities, these future jobseekers have been encouraged to look into which skills are required by the market, tailoring their occupational training to align with demand and thereby improving their chances of finding a job, writes Vian Chinner – a South African innovator, data scientist and CEO of the machine learning company specialising in consumer behaviour prediction, Xineoh.

With rapid innovation and development in the field of artificial intelligence (AI), all careers – including high-demand professions like engineers, teachers and electricians – will look significantly different in the years to come.

Notably, the third wave of internet connectivity, whereby our physical world begins to merge with that of the internet, is upon us. This is evident in how widespread AI is being implemented across industries as well as in our homes with the use of automation solutions and bots like Siri, Google Assistant, Alexa and Microsoft’s Cortana. So much data is collected from the physical world every day and AI makes sense of it all.

Not only do new industries related to technology like AI open new career paths, such as those specialising in data science, but it will also modify those which already exist. 

So, what should matriculants be considering when deciding what route to take?

For highly academic individuals, who are exceptionally strong in mathematics, data science is definitely the way to go. There is, and will continue to be, massive demand internationally as well as locally, with Element-AI noting that there are only between 0 and 100 data scientists in South Africa, with the true number being closer to 0.

In terms of getting a foot in the door to become a successful data scientist, practical experience, working with an AI-focused business, is essential. Students should consider getting an internship while they are studying or going straight into an internship, learning on the job and taking specialist online courses from institutions like Stanford University and MIT as they go.

This career path is, however, limited to the highly academic and mathematically gifted, but the technology is inevitably going to overlap with all other professions and so, those who are looking to begin their careers should take note of which skills will be in demand in future, versus which will be made redundant by AI.

In the next few years, technicians who are able to install and maintain new technology will be highly sought after. On the other hand, many entry level jobs will likely be taken care of by AI – from the slicing and dicing currently done by assistant chefs, to the laying of bricks by labourers in the building sector.

As a rule, students should be looking at the skills required for the job one step up from an entry level position and working towards developing these. Those training to be journalists, for instance, should work towards the skill level of an editor and a bookkeeping trainee, the role of financial consultant.

This also means that new workforce entrants should be prepared to walk into a more demanding role, with more responsibility, than perhaps previously anticipated and that the country’s education and training system should adapt to the shift in required skills.

The matric classes of 2018 have completed their schooling in the information age and we should be equipping them, and future generations, for the future market – AI is central to this.

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