Portfolio Committee on Energy National Energy Efficiency Strategy and Review Process

Portfolio Committee on Energy

National Energy Efficiency Strategy and Review Process

Ms Mokgadi ModiseChief Director: Clean Energy

31 January 2013

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OUTLINE

1. Background and context

2. National Energy Efficiency Goals

3. National Energy Efficiency Strategy (NEES) Objectives

4. NEES Review Process

5. EE Policy Mapping Study

6. Overall Energy Efficiency Policy Framework

7. Proposed National EE Action Plan

8. National EE Interventions

9. NEES Implementation Progress

10. Stakeholders

BACKGROUND ON 2005 NEES

• The White Paper on Energy Policy (1998) gives a mandate to the Department of

Energy (DoE) to pursue an Energy Efficiency programme which is one of the lowest

cost options for reducing energy consumption.

• The NEES was approved by Cabinet and released in 2005 to explore the potential

for improved energy utilisation through reducing the nation’s energy intensity (thus

reducing greenhouse gas emissions), and decoupling economic growth from energy

demand.

• The original NEES stated that “Government will ensure that the necessary

resources are made available to establish systems and legislation to facilitate the

specification, collection, storage, maintenance and supply of energy-related data,

according to the requirements of integrated energy planning and international

standards.”

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2005 NATIONAL ENERGY EFFICIENCY GOALS

• The NEES outlined how an overall energy demand reduction target of 12% by

2015 would be achieved with contribution from the subsectors, that is, industry

and mining (15%), commercial and public buildings (15%), residential (10%) and

transport (9%).

• Implementation plans were drawn up for each of the sectors with forecasted

targets of energy use reductions based upon assumptions about energy demand

over the next 10 years, including the associated drivers, such as the economic

development and population growth.

• As part of implementing the NEES, interventions were to be implemented by

concentrating on no-cost and low payback options with a high impact. These

were to be followed by medium to long-term higher investment interventions.

• Since the release of the NEES, several legislative frameworks had to be

developed or put in place to support the implementation of the Strategy.

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NATIONAL ENERGY EFFICIENCY STRATEGY OBJECTIVES

The Vision of the NEES is “Reducing the energy intensity of the economy through energy efficiency”

Achievement of this vision will assist in fulfilling the following national objectives:

•Enhancing energy security by making better use of existing and new generation capacity.

•Improving South Africa’s global competitiveness through reduced energy input cost.

•Decoupling growth in energy consumption (and GHG emissions) from growth in GDP.

•Improving global competitiveness will, in turn, contribute to job creation.

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2011 NEES REVIEW PROCESS (1)

• The first review of the 2005 NEES was done in 2008, a revised document

was then issued for public comments, however the comments received were

not favourably, and requested a more radical alterations including clear

definition of energy efficiency, monitoring system and baseline information

that considers the fact companies are at different level of achievements of

the targets.

• Parallel to the development of NEES in 2005, an energy efficiency target

Monitoring Methodology Handbook was also developed.

• This EE Monitoring Methodology Handbook provides a detailed input data-

streams required, however its review is also necessary to ensure that the

South African energy efficiency monitoring system take full advantage of the

current development and international best practice updates.

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2011 NEES REVIEW PROCESS (2)

• The second NEES review process took into account current developments in

the energy sector, that is, IRP 2010, National Climate Change Response

Policy White Paper, and Industrial Policy Action Plan.

• The second review has been conducted under the Industrial Energy Efficiency

Improvement Project (IEEIP) in collaboration with the dti, Business, and

international partners.

• New measures are also being introduced through legislation, incentives,

standards and training initiatives aimed at supporting the introduction of more

efficient practices, energy management and systems optimisation to realise

the potential savings and reduce the wastage which characterises every

sector. In the implementation process, other national objectives will be

addressed in creating ‘green’ jobs and developing the energy services market.

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2012 ENERGY EFFICIENCY POLICY MAPPING STUDY

• Parallel to the 2011 NEES review process, an EE Policy Mapping Study was conducted through the South African Energy Programme (SAGEN) in collaboration with SANEDI and GIZ.

• The outputs of the study provides a comprehensive policy and legislative context for the development of the National Energy Efficiency Action Plan (NEEAP) for the Republic of South Africa.

• The purpose of this review was therefore to:

– understand the existing energy efficiency policy and regulatory environment, key initiatives and programmes, and stakeholders

– develop the framework for a monitoring tool and action plan to be used to assist in the development of a coordinated, unified and effective approach to:

• energy efficiency,

• energy conservation and

• demand-side management.

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OVERALL ENERGY EFFICIENCY POLICY FRAMEWORK

Policy map, monitoring tool and Proposed

NEEAP Framework

Policy map, monitoring tool and Proposed

NEEAP FrameworkState of PlayState of Play

National

Stakeholders

National

Stakeholders

International StakeholdersInternational Stakeholders

Review of policy

documentation,

initiatives and

programmesReview of policy

documentation,

initiatives and

programmes

NEEAP international

Best Practice

NEEAP international

Best Practice

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ANALYSED ENERGY EFFICIENCY POLICY, INITIATIVES AND PROGRAMMES

• Supreme law – RSA Constitution • Energy Policy and Strategy• Energy Regulations and Legislation• Energy Efficiency Incentive Programmes, taxes,

rebates and other incentives• Industrial policy, strategy and relative incentive

programmes• Environmental and Climate Change National Policy

and Strategy

• Overview• Current status and implementing

agency• Key EE objectives and targets• Specific links to EE• Summary of effectiveness in

relation to EE

• Overview• Current status and implementing

agency• Key EE objectives and targets• Specific links to EE• Summary of effectiveness in

relation to EE

Energy Efficiency InitiativesEnergy Efficiency Initiatives

Government, International Agencies and Donor Funded Programmes

Government, International Agencies and Donor Funded Programmes

Policy, Strategy, Regulations, Taxes and IncentivesPolicy, Strategy, Regulations, Taxes and Incentives

• Overview• Implementing body• Programme Targets• Links to Acts, Policy or Regulations• Funding Source, Format and Value• Comments, effectiveness

Challenges & Opportunities

• Overview• Implementing body• Programme Targets• Links to Acts, Policy or Regulations• Funding Source, Format and Value• Comments, effectiveness


• Overview• Initiatives • Comments, effectiveness


• Overview• Initiatives • Comments, effectiveness


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PROPOSAL FOR SA NEEAP STRUCTURE

NEEAP for South Africa

High Level Contextual Environment, Objectives and Targets – with reference to EE Strategy for detail

Sector 1 Sector 2 Sector 4 Sector 3

Sector Breakdown – as defined in the EE Strategy

Sector outline, overall targets and approach.Opportunities and challenges.Methodological approach.Applicable legislationTargeted / priority areas

Details of specific initiative number 1Compliance with legislation or policy

Details of specific initiative number 1 Programme analysis and details

Details of specific initiative number 2Compliance with legislation or policy

Details of specific initiative number 2 Programme analysis and details

Summation of Results

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CONSULTED STAKEHOLDERS FOR EE POLICY MAPPING STUDY

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Public Agencies / NGO / AssociationsDepartment of Energy (DoE) Green Building Council of South Africa (GBCSA)

Department of Water & Environmental Affairs National Business Initiative (NBI), SAPOA

Department of Public Works (DPW) Green Energy Efficiency Fund (GEEF)

National Energy Regulator (NERSA) Swiss Agency for Development and Cooperation (SDC) and Swiss Economic Co-operation and Development (SECO)

Department of Science & Technology GIZ, Royal Danish Embassy

Department of Trade and Industry French Development Agency (AFD)

Department of Tourism British High Commission

Provincial Departments Renewable Energy and Energy Efficiency Partnership (REEEP)

Eskom, SANEDI, CIDB British Foreign and Commonwealth Office (FCO)

SABS & NRCS Japan International Cooperation Agency (JICA)

National Cleaner Production Centre (NCPC) -SA Business Associations (BUSA / BLSA / BBC)

Municipalities ESCos, Energy Efficiency Leadership Network (EELN) Members

NATIONAL ENERGY EFFICIENCY INTERVENTIONS

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• 49m campaign

• Other campaigns including schools etc.

• 49m campaign

• Other campaigns including schools etc.

• Localize supply of LED technology for street-lighting

• Source supply-install of LED

• Measure impact relative to baseline

• Localize supply of LED technology for street-lighting

• Source supply-install of LED


• Collate database of public buildings

• Measure baseline consumption

• Source supply-install of technologies that reduce consumption


• Collate database of public buildings

• Measure baseline consumption

• Source supply-install of technologies that reduce consumption


• Source supply of product that is >80% local content.

• Source installation and maintenance

• Initiate Standard Offer model for solar geysers


• Source supply of product that is >80% local content.

• Source installation and maintenance

• Initiate Standard Offer model for solar geysers


• Solicit various interventions through a Request for Proposals


• Solicit various interventions through a Request for Proposals


Awareness Campaign Municipal Streetlighing Programme

Public Buildings Programme

Solar Water Heating Programme

Industrial EE Improvement Programme

Improve public awareness and increase public

participation in EE programme

Increase Municipal revenues (decrease consumption) by retrofitting street-lighting with new technologies.

Retrofit HVAC, lighting etc. with

new technologies, reduce energy

consumption in line with building codes

Increase penetration in high consumption

domestic areas by replacing electric

geysers

Decrease energy intensity through

various other interventions (Request for Proposals)

Policy, Institutional Arrangements, Standards and Regulatory Mechanisms including the Measurement of baseline consumptions in respect of each programme followed by monitoring of

targets

NEES IMPLEMENTATION PROGRESS Energy Efficiency Monitoring System (EEMS)

• Regarding legislation to implement the NEES, the DoE promulgated “the

Regulations for Mandatory Provision of Energy Data” in March 2012, which

will assist in the collection of energy efficiency data required for the EEMS,

and the setting of long-term targets.

• In light of the above, the DoE embarked on the establishment of an EEMS

in 2011.

• The EEMS will track the achievements of the targets set out in the NEES

but the quantum of data necessary to determine the progress on targets

will only be available by the time of the third NEES review in 2015.

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ENERGY EFFICIENCY MONITORING SYSTEM

• The project is being implemented together with South African Local Government Association (SALGA) and South African National Energy Development Institute (SANEDI) as a financial administrator.

• The project management is through a Project Steering Committee (PSC) with representatives from other government departments.

• Overall objectives are to: • Institutionalise energy efficiency monitoring system and develop energy

efficiency management systems within government structures • Track the developing state of energy efficiency in South Africa using updated

energy efficiency indicators • Identify drivers for, and responses to energy efficiency changes • Monitor progress towards the targets and goals set in the National Energy

Efficiency Strategy • Inform future energy efficiency policies, financing, regulations and plans

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MUNICIPAL EEDSM MONITORING AND EVALUATION

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Planning Planning Reporting Reporting Implementation Implementation

Indicators , Economic Efficiency, Payback Period

Indicators , Economic Efficiency, Payback Period

- Inventory List (i.e public lighting, etc) - Budget Required- EE measures/interventions- Energy savings potentials - Emissions reduction potentials - Economic viability (RoI)

- Business/Implementation plan - M&V process - Contractors appointment- Monthly/quarterly reporting - Budget spending

- Budget Spending - MW/MWh saved - tCO2 saved - Reliability of data source

- Number of jobs created per Mio investment - MWh/a saved per Mio - tCO2 saved per Mio - Total energy cost savings

Municipal EEDSM Development & Implementation

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Analysis of Business/Implementation

Plan

Analysis of Business/Implementation

Plan EEDSM RfP EEDSM RfP

EEDSM Grant Allocations EEDSM Grant Allocations

Inventory/Baseline Determination

Inventory/Baseline Determination

EE Monitoring &

Evaluation System

EE Monitoring &

Evaluation System

% EE Improvement for Municipalities % EE Improvement for Municipalities

Adjustment of the Baselines/Inventory

List

Adjustment of the Baselines/Inventory

List

EEDSM Project(s) Implementation EEDSM Project(s) Implementation

Data Validation

Implementation

NEES IMPLEMENTATION PROGRESS Standards & Regulations (1)

• Standards for Energy use in new buildings, Energy Management, and

Measurement and Verification of energy savings (SANS 104400 XA, SANS

50001 & SANS 50010 respectively) were developed with South African

Bureau of Standards (SABS) through the dti.

• SANS 50010 will be of use to local industries in four ways, namely to: (i)

enable industries to accurately quantify the true benefits as a result of energy

savings measures; (ii) provide consistent feedback regarding the typical

performance of the various energy savings opportunities available to

industry; (iii) let companies improve their monitoring against targets; and (iv)

allow companies to claim any tax benefits available to them from energy-

saving programmes.

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NEES IMPLEMENTATION PROGRESS Standards and Regulations (2)

• Standard for Energy Management (SANS 50001) – This standard will

assist in the continual improvement framework to incorporate energy

management into everyday organizational practices. In the context of

Energy Management, companies will do the following:

– Plan: conduct the energy review and establish the baseline, energy

performance indicators (EnPIs), objectives, targets and action plans

necessary to deliver results that will improve energy performance in

accordance with the organization's energy policy;

– Do: implement the energy management action plans;

– Check: monitor and measure processes and the key characteristics of

operations that determine energy performance

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NEES IMPLEMENTATION PROGRESS Standards & Regulations (3)

• Income Tax Act allowances on industrial energy efficient manufacturing

capabilities and energy efficiency savings, Section 12l and 12L.

– Draft Regulations on Section 12 L is providing for an allowance on Energy

Efficiency Savings are in the pipeline for promulgation (i.e. allowance for

measured and verified savings).

– Draft Regulations on Section 12L have been completed and will be

promulgated once the finalisation of the amendment of section 12 L by

National Treasury based on the Office of the Chief State Law Advisor.

– Regulations for 12i is aimed at the large manufacturing investments (i.e.

upgrades, expansions or new facilities that exceed R30 million and R200

million respectively).

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STAKEHOLDERS CONSULTED IN THE DRAFTING OF 2011 NEES REVIEW DOCUMENT

• The DoE invited national, provincial and local government departments to

workshops in Gauteng and KwaZulu Natal, and interested and affected parties to

sector workshops in 2011.

• Focused engagements/discussions were also held on the development of

regulations and standards interlinked to the NEES continued with the dti, National

Treasury, DEA, Mineral Resources, the National Regulator for Compulsory

Specifications and SABS as part of this second review.

• In addition to the above, the Business Unity South Africa (BUSA) and the National

Business Initiative (NBI) were also engaged.

• The draft 2011 NEES second review document was presented to the Infrastructure

Development Cluster on the 10th October 2012.

2011 NEES REVIEW STAKEHOLDERS CONSULTATION PROCESS

• The stakeholders consultation process of the 2011 NEES review document will

also take into consideration the EE Policy Mapping Study findings and

recommendations, and also utilised for the development of a multi-year National

Energy Efficiency Action Plan

• Apart from the public comments that are expected to be received, the

Department of Energy will also coordinate workshop sessions targeting

government departments, and NEDLAC social partners.

• International Partners will also be informed of the 2011 NEES review process,

and specifically the planned energy efficiency interventions for the next three

years.

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ACTION PLAN AFTER PUBLIC CONSULTATION

• Once the Public Consultation process has been completed, all comments will be

consolidated and incorporated into the draft NEES Second Review Document.

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CONCLUSION

• Public comments for the 2011 NEES review process will also take into

consideration the EE Policy Mapping Study findings and recommendations, and

the development of a multi-year National Energy Efficiency Action Plan (NEEAP).

• Draft NEES Second Review Document approved by Cabinet to be gazetted for

public comments.

• That targeted sector workshops will be held as part of the 2011 NEES review.

• The draft 2011 NEES second review document will be gazetted for a period of six

weeks (from 29 November 2012 to 30 January 2013) to allow the pubic adequate

time to comment.

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Portfolio Committee on Energy National Energy Efficiency Strategy and Review Process

Documents

Transcript of Portfolio Committee on Energy National Energy Efficiency Strategy and Review Process