Sustainability Market Study and Business Plan for Southern ... · Scania Southern Africa March 9,...

Sustainability Market Study and

Business Plan for Southern Africa

March 9, 2018Scania Southern Africa

Mark Templeton, Manager Sustainability

Southern African Economic Drivers


Economic development is driven by

Southern Africa’s growth is starting from a much lower base, but it is being driven by a variety of factors, ranging from more effective exploitation of natural resources to expanding free trade agreements within the Southern continent.

Key Drivers of economic growth are:

• Agricultural exports

• Mining (Availability/Cost of Natural Gas/Biogas)

• Urbanization

• Investment in infrastructure

• Tourism

• Foreign direct investment

• Regional integration

Market Study Methodology Used


External The role of OEM

Educate Customer

Test Program

OEM Solution

Total operating

economy

Fu

el S

up

pli

ers

Str

ate

gy

SO

E

NG

O’s

Do

no

r F

un

din

g

Go

vern

me

nt

Ten

de

rs

Na

tio

na

l/ R

eg

ion

al F

lee

ts

Me

tro

’s /

Mu

nic

ipa

liti

es

Na

tio

na

l Re

tail

ers

Inte

rna

tio

na

l / L

oca

l

En

vir

on

me

nt

Po

licy

Customer

infrastructure

International CO2 Reduction Table


Biodiesel

Up to 50%CO2 reduction

Biogas/natural gas

Up to 90%CO2 reduction

Hybrid

Up to 85% CO2 reduction

Bioethanol / ED95

Up to 90% CO2 reduction

Sustainability Technology Implementation Cycle


Late MajorityEarly MajorityEarly Adopters LaggardsInnovators

Ethanol

Electric

CNG/BioGas

BtL

Biodiesel

HVO

Fuel S

tatu

s

Biofuels Price Positioning Matrix


Low Quality

Low

Pri

ce

High Quality

Hig

h P

rice

ED 95 Ethanol

Diesel

Bio Diesel

BioGas

CNG

500 ppm 10 ppm


Selected BioFuels Energy Content Comparison - Cost

EV BioDiesel

HVO/BtL

CNG/CBG

LNG/LBG

Diesel

500/50/10Ethanol

Units /

100km

Cost /

100km

Price /

Unit

15

kWh

38

Litres

41

Litres

40

Litres

64

Litres

R 1.50/

kWh

R 12.50/

Litre

12.50/

Litre

R 11.00/

Litres

R 9.00/

Litres

R 360.00 R 475.00R 451.00R 195.00 R 800.00

Vehicle – Inner city distribution

0,00

1,00

2,00

3,00

4,00

5,00

6,00

7,00

8,00

9,00

0,00 0,05 0,10 0,15 0,20 0,25 0,30 0,35 0,40

NO

X (g

/kW

h)

PM (particulates) (g/kWh)

Euro 1 1992

Euro 2

Euro 4 2006

Euro 5 2009

Euro 3 2001

Euro 2 1996

NO

Xre

duction 9

4 %

Particle reduction 98 %

Euro 6 2014


Euro Emissions Specification(Go directly to Euro 6 with clean biofuels)

Major Gas Reserves Africa


Major Gas Reserves in (tcf)

•Mozambique – 195 tcf

•Botswana – Unknown (Coal based)

•Karoo Basin – 400 (Shale Gas)

•Mossel Bay – (only 2 to 5 years left)

•Orange River Basin – Unknown

Crude oil

•Orange River Basin – Unknown

•Namibia Coast – 11 Billion Barrels

Sustainability – BioGas/CNG (CHP) product offering


Market potential (Methane Gensets)

• 824 waste water treatment plant in SA

(+/-9 generating methane for gensets)

• 6 major CNG suppliers

o CNG Holdings

o Egoli Gas

o Novo Gas

o Sasol Gas

o Springlight Gas

• 3 major biogas suppliers

o B2Watt

o NewsHorizans

o Renergen

• 300 small scale digesters

• 189 Municipalities (tender business)

Market potential (Rural BioGas Gensets + CHP)

Objective:

• Electrification of remote communities

Concept

• Present working concept to DBSA/IDC/NGO’s for funding

• Create job’s + becomes self-sufficient

• Gas used for cooking + powering gensets

• Powering teaching aids (computers + TV + Satellites disks

etc)


Associations

Key

TS - Truck Sales

BS - Bus Sales

E - Scania Engines

S - Sustainability

T - Tender

ByImportance CommentsAssociation

Medium

High

High

High

High

High

Medium

Medium

High

S / BS

S

S

BS / S

S

TS / S

S / BS

E / S

Cost

R 1 k

tba

tba

tba

tba

tba

R 40 k

tba

tba

Opportunity to supply engines

Total untapped mkt segment

Focus around Giogas mkt

Driven by bus sales supported

by sustainability team

Focus around gas mkt

Opportunity to supply engines

Driven truck sales supported


E / S Opportunity to supply engines

Driven by bus sales supported



Statuary bodies

Importance CommentsAssociation

• Primary focus on SACD region

• The have created a green fund for Biofuel

• Main focus, job creation, BBBEE, SME

High

Medium

High

High

High

High

Medium

• Drive industrialization of South Africa

• Various focus, Biofuels, job creation, BBBEEE etc

• Reports into the DTI

• Statuary body, driving trade locally and globally

• Sets policy for the ruling government

• Main driver why SA has an successful auto industry

• Statuary body, responsible for energy

• Sets policy, and controls fuels pricing etc

• Currently driving various biofuels projects

• Sets product/quality standards for all goods

• Key focus – safety standards of consumer/public

• SA standards are Eurocentric

• Section 3A state owned institute

• Primary focus is to drive/facilitate green energy

• Key driver is to reduce Carbon foot print

• Statuary body, sets all road legislation

• Driving CNG/BioGas ADR spec via SABS

CNG/BioGas/LNG Supply Point National


CNG (<16)

• 3 main suppliers CNG Holding/Nova Gas/Spring light.

• CNG/Nova Gas has 14 filing stations in Gauteng.

• Spring light Gas has 1 in Natal and 2 planned for Gauteng.

• All 3 sell Sasol CNG has with a methane content of 92%

• All 3 plan to increase footprint by 2 new site a year.

• All 3 have the capability of supplying virtual station.

• The capital invested per company < R 250 million

BioGas

• BioTain/Durban Sold Waste/New Horizons/New GX/

Renergen/The Waste Group.

• Barriers to enter are high.

• The methane content is between 92 to 97%

• Sign MOU with suitable long term suppliers.

LNG (3)

• The coastal site have been identified.

• Environmental Impact Study still to be done

• Timing of projects (2021)

• Capex range < R 2 billion

• 5 new LNG points in SA

Overview of BioFuel Focus for Southern Africa


Alternative Fueling Solution

Bio Diesel

Biomas to Liquid - BTL

Hydrated Vegetable Oil - HVO

Natural Gas

– CNG (Compressed Natural Gas)

– LNG (Liquid Natural Gas)

BioGas

– CBG (Compressed BioGas)

– LBG (Liquid BioGas)

Electric Vehicle (Battery) - EV

Hybrid Electricity/battery powered

The Critical issues not mentioned are:

Finding the correct supply partner in regards to fuel and infrastructure

Medium to long term strategic intent

Guaranteed consistence and product quality

Local, regional and national distribution foot print

NB: (An NDA & MOU to be signed with all local suppliers)


• 40 bus

• Bus range of approximately 350

kilometres

• A CNG bus carries 33 seated

passengers and 44 standing

• 6.9litre Cummins Euro 5 engine

• “The new buses will cost 40% less

to maintain than the conventional

diesel buses and this means the

metro will save much needed

revenue to channel towards

improved and quality service

delivery,”

Ref: Pretoria News

CNG Mercedes Benz – Scania Bus

• 10 bus

• Bus range of approximately 650

kilometres

• A CNG bus carries 65 seated

passengers

• 9.0 litre Scania Euro 6 engine

Unique Selling Points (USP) Diesel/BioDiesel/CNG


Lower noise pollution for CNG – extended (FMCG) deliveries periods

Lower CO2 tax - future benefit (when implemented)

Scania’s leadership role / environmental stewardship responsibility

BioFuels solution opens opportunities for fleets to enter new markets

Scania has the widest sustainable solution amongst truck OEM

Lower total operating cost (TOC)

Uptime improvement for CNG – extended services intervals

BioFuels solution opens doors for sales into new untapped fleets

Introduction of the first Euro 6 truck engine into the local market

Unique Selling Points (USP) BioDiesel CNG Diesel

aaaa

aaaa

aaaa

aaaa

aaaa

aaaa

aaaa

aaaa

aaaa

aaaa

aaaa

aaaa

aaaa

aaaa

aaaa

Sustainability Market Study and Business Plan for Southern ... · Scania Southern Africa March 9,...

Documents

Transcript of Sustainability Market Study and Business Plan for Southern ... · Scania Southern Africa March 9,...