Workshop on Energy Efficiency and Demand Side Management

Meeting report

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This Report is a Contact Natural Resource Information Service
Taking Parliament to People, and People to Parliament
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The aim of this report is to summarise the main events at the meeting and identify the key role players. This report is not a verbatim transcript of proceedings.

MINERALS & ENERGY PORTFOLIO COMMITTEE
30 August 2001
WORKSHOP ON ENERGY EFFICIENCY AND DEMAND SIDE MANAGEMENT

Chairperson: Mr D Nkosi

Documents handed out:
Workshop on Energy Efficiency and Demand Side Management Programme (Appendix 1)
National Energy Efficiency Programme (Mr S Tyatya)
Energy Efficiency in Industry in South Africa (Mr M Howells, Mr A Trikam, Mr Kenny)
Energy Efficiency: Why is it important to South Africa (Mr Randall Spalding-Fecher)
DSM – Short to Medium Term Demand Side Strategy (Mr A Africa)
Efficient Lighting Initiative – South Africa (Mr Barry Bredenkamp)
Energy Efficient Housing (Ms T Nkambule and Mr G Chavdarov)
Energy Efficiency and Local Authorities (Ms L Mohamed and Mr M Booi)

SUMMARY
The Committee conducted a workshop on energy efficiency and demand side management. Presentations were made by the Department of Minerals and Energy, Eskom and other parties. The main issues discussed were the importance of increasing energy efficiency in industrial and residential sectors. Opportunities and difficulties of implementing energy efficiency programmes were discussed. The Committee Members were given an opportunity to comment and ask questions. For a full list of the presentations, refer to the workshop programme.

MINUTES
Mr D Nkosi (ANC) as Chairperson welcomed the presenters and Committee Members and announced that since the first presenter on the programme was running late, the workshop would begin with the second presentation. As a matter of procedure, the Chairperson suggested that the presentations be short to leave adequate time for discussion. He then asked Mr Tyatya to begin his presentation.

DME Position on Energy Efficiency
Mr S Tyatya (Department of Minerals and Energy (DME)) presented on the National Energy Efficiency Programme. The key issues identified in the White Paper on Energy such as the promotion of energy efficiency across sectors, facilitation of the development of energy efficiency technology, codes and standards, institutional arrangements for energy efficiency and energy conservation and environmental protection. In giving the scope of energy efficiency activities, he stated that the programme would cover the whole energy sector, energy sources and the energy system.

He proceeded to discuss the National Energy Efficiency Workshop which was to further energy policy implementation through stakeholder consultation, campaign promotion, information sharing and institutional building and review. There were challenges faced in implementing energy efficiency and stated that these would have to be overcome. He stated that the main challenges were awareness, energy pricing, institutional arrangements, difference between investment period and speed of return and lack of appropriate industrial and household technology.

Mr Tyatya also discussed capacity building in energy efficiency in greater detail, and proceeded to the issue of energy efficiency and technology. He presented several ways intervention in the household appliance industry could increase energy efficiency and shared the example of "white appliance" labeling. In his discussion regarding the drives for energy efficiency, the stated that the main issues were savings and environmental protection. In conclusion, Mr Tyatya discussed energy and environment issues and stated that energy efficiency was a climate change mitigating option, would reduce emissions and slow down environmental degradation.

Discussion
The Chairperson stated that the issues were very clear and invited Committee Members to share comments and issues for clarification.

Professor I Mohamed (ANC) asked for clarification on the issue of "white appliance" labeling.

Mr Tyatya responded by elaborating on the issue. He stated that labeling "white appliances" consisted of labeling household appliances in order to indicate to consumers which appliances were more or less energy efficient.

Mr I Davidson (DP) asked for a clarification on the pervasiveness of the use of household energy consumption regulating devices ("geyzers").

Professor Mohamed stated that the devices were not used to increase energy efficiency, but mainly to control peak energy demand periods.

The Chairperson proceeded by asking the next presenter to begin.

Industrial Energy Efficiency
Mr M Howells, Mr A Trikam and Mr A Kenny (Energy Research Institute, University of Cape Town) presented on energy efficiency in South African industry. Mr Howells introduced his team and asked Mr Kenny to begin.

Mr Kenny proceeded by discussing the energy demands of industry in South Africa. He provided a breakdown of the various industrial sectors, with iron and steel having the highest energy demands. He also provided a breakdown of where the energy came from, with coal being the biggest source. He discussed South African attitudes to energy efficiency and discussed the benefits that could be gained from making industry more energy efficient. The benefits he discussed involved monetary savings and environmental protection. He presented the 3E Strategy, Energy-Efficiency-Earnings, a programme implemented in partnership with DME. Through this programme, guidelines were published for industry to increase awareness on various ways of saving energy that were easy and had quantifiable benefits. Mr Kenney concluded and handed the presentation over to Mr Trikam.

Mr Trikam presented on the link between industrial energy efficiency and greenhouse gas mitigation. He stated that the objective was to identify the major opportunity for climate change mitigation through industrial energy efficiency. He shared case study results that revealed that through energy efficiency measures, the costs of these measures could be recovered relatively quickly, CO₂ abatement would be significant and money would be saved. He then discussed the process through which the mitigation cost curve was obtained and handed the presentation over to Mr Howells.

Mr Howells discussed future programmes and the continuation of the 3E Strategy. In conclusion, he stated that energy efficiency and profit were compatible.

Discussion
The Chairperson commented that the issue of awareness presented a challenge because you could only tell industry and could not command industry to become energy efficient.

Mr Howells added that linking energy lost to money potentially saved was the key to increasing energy efficiency in industry. He argued that industry would then realize that there were basic energy management steps that were affordable and made economic sense.

The Chairperson noted the arrival of Mr R Spalding-Fecher and asked him to begin his presentation. He noted that the material was intended as an introduction and would have been best if presented first, but stated that it would still be beneficial for Committee Members to hear his presentation.

Introduction to Energy Efficiency
Mr R Spalding-Fecher’s (Energy Development Research Centre, University of Cape Town) presentation introduced the issue of energy efficiency. He began by defining energy efficiency as the relationship between energy input and energy output. Using light bulbs and automobiles as examples, he illustrated how only a small percentage of the energy input was actually turned into the desired output. So since energy inefficiency was pervasive, efficiency would have numerous benefits ranging from financial savings to health and the environmental benefits. He proceeded to discuss energy intensity in South Africa and elaborated on the barriers to energy efficiency. He listed the barriers as being: split incentives between energy suppliers who want to sell more energy and energy consumers who want the most cost-effective service; low energy costs; lack of policy and departmental co-operation; supply side paradigm and focus on energy supply in the regulation; and lack of access to clean and efficient fuels and appliances. He then discussed the White Paper briefly and focused on the implementation of the White Paper. He discussed electricity restructuring through regulation, financing, and information and policy to move towards efficiency. In conclusion, he stated that energy efficiency was the cheapest way to supply energy needs and emphasized the government’s role in removing barriers to socially beneficial projects.

Discussion
The Chairperson opened the floor for discussion and commented on the importance of communicating energy efficiency to rural communities where illiteracy was high. On the issue of energy efficiency being cheaper than supplying low cost energy, he stated that service provision was a matter of survival for many and added that energy efficiency should not be put before service provision.

Mr Spalding-Fecher responded by stating that energy efficiency was not intended to replace access to services. On the issue of communicating energy efficiency issues to communities where illiteracy was high, he stated that there were ways to communicate with and involve illiterate people in energy efficiency.

Ms D Motubatse (ANC) commented on whether policy could help abate the problem and asked how long the government could continue to monitor implementation and prevent programme failure or marginalisation.

Mr Spalding-Fecher responded that a package of interventions could help abate the problem.

Mr J Nash (ANC) commented that there was knowledge from the past sitting in DME archives and expressed hope that with Mr Tyatya in position, they would be looked at and put to use. He also commented on the government’s target of providing free water and electricity. He stated that the savings that would be made by reducing waste and increasing efficiency in the electricity and water industries could finance the provision of services to those without access.

Mr Spalding-Fecher agreed and stated that there was a potential of using efficiency to provide low cost services. He added that efficient use of resources could provide opportunities for saving.

The Chairperson announced a break and encouraged interaction between Committee Members, presenters and other parties present at the workshop.

Demand Side Management
Mr A Africa (Eskom) presented on short and medium term demand side strategy. He stated that the previous presentations were from industry’s perspective and added that his presentation would give the national perspective. He defined the objectives of the demand side strategy to be the managing of demand for electricity. He proceeded to define Integrated Strategic Electricity Planning (ISEP) as a process that selected from both demand and supply sides a course of action that would have optimal value for the consumer and Eskom. He proceeded to discuss Demand Side Management and stated that its aim was to influence energy use in order to create a win-win situation for both energy consumers and suppliers. He then touched on the various demand side options for the residential, commercial and industrial sectors. He concluded by listing and briefly discussing the various programmes Eskom was currently operating to increase energy efficiency.

Discussion
The Chairperson asked the Committee Members for comments and points of clarity.

Mr Nash stated that Eskom projects were carried out only in Table View and asked why.

Mr Africa responded by stating that the Table View project was a pilot project and stated the reasons for selecting Table View as high population growth rates and frequent disruptions of energy supply. He added that Eskom was in the process of implementing nation-wide programmes.

Professor Mohamed commented on the "geyzer" controls and stated that they were used to smooth out peak periods of electricity demand.

The Chairperson asked for clarification on how Demand Side Management applied to various sizes and classes of customers.

Mr Africa stated that price was the key to Demand Side Management. He stated that low-income people had other priorities for their money besides investing in energy efficiency and added that the programme was catered to specific sectors and stated that Eskom was currently looking to create appropriate gadgets for low-income households.

The Chairperson stated that middle-level customers should be the starting point to sustain energy efficiency programmes and ensure the continuous provision of quality services. He then asked the next presenter to begin.

Energy Efficient Lighting Initiative (Bonesa)
Mr B Bredenkamp (Eskom) presented on the Efficient Lighting Initiative (ELI) implemented by Bonesa and funded by Eskom and the Global Environment Facility. He stated the goals of ELI to be increased penetration of energy efficient lighting technologies to meet the ISEP targets: peak energy demand reduction; reduced electricity costs for customers; capacity building and skills transfer; reduced greenhouse gas emissions; and job creation and poverty alleviation. He also discussed the primary and secondary benefits to Eskom, customers, the environment, municipalities, developers and South Africa. In conclusion, he stated that all parties would benefit from ELI and added that South Africa could have future opportunities to replicate the programme in other parts of the country and the region.

Mr Kenney asked what could be done about energy efficient bulbs that failed more frequently than the inefficient bulbs.

Mr Bredenkamp stated that products differed in quality and added that there was illegal importing of low quality "energy efficient" light bulbs. He stated that Eskom was in the process of putting labels on energy efficient products that would go through rigorous testing and meet the necessary technical specifications and added that these light bulbs would be accompanied by a one-year unconditional guarantee.

Mr Nash and Professor Mohamed asked if there were any efforts to replace the florescent lighting system in government buildings and other public facilities with energy efficient products.

Mr Bredenkamp responded that Eskom was working with DME to find ways of upgrading the lighting system in government and other public buildings.

The Chairperson welcomed the next presenters and asked them to begin.

Energy Efficient Housing
Ms T Nkambule and Mr G Chavdarov (International Institute for Energy Conservation – Africa (IIEC-Africa)) presented on energy efficient housing in South Africa.

Ms Nkambule proceeded to define an energy efficient house as one that was warm in winter, cool in summer and provided a healthy living environment by reducing household energy use. She provided pictures of energy inefficient housing and compared them to pictures of energy efficient houses. She discussed the Passive Solar Design Principles behind energy efficient housing. She stated the benefits of energy efficient housing that ranged from improving the comfort of the home to improving quality of life. In conclusion, she discussed how IIEC supported energy efficient housing through capacity building, direct technical assistance, demonstration projects, policy input and market transformation.

Mr Chavdarov presented on the linkages between energy efficient housing and climate change. He noted the mechanisms currently in place to mitigate or reduce climate change. He gave examples of how housing could be used to ensure a healthier future. His example was that of a Dutch government funded and UNFCCC registered project established in four communities in South Africa and focused on the project in Lady Gray. He stated that energy efficient housing was important to mitigating climate change because housing was identified as a mitigating opportunity. He added that climate change financing opportunities such as the Clean Development Programme (CDP) could be used to advance energy efficient housing for poor communities in South Africa. He concluded by stating that the Committee and DME could help support energy efficient housing by ensuring that energy efficiency was included in Acts and department policies.

Discussion
The Chairperson asked how flexible the issue of direct technical assistance was and asked if it was possible to use technical assistance for the benefit of low-income housing and invited comments and questions from others.

Ms Nkambule replied that the focus had been on new developments. She stated that the project had received requests for assistance from individuals, so IIEC was looking at retrofitting existing houses and stated that it would be an area of future expansion.

Mr Nash commented on the project in Lady Gray and highlighted the features of the energy efficient houses.

The Chairperson noted that time was short and asked Committee Members to reserve questions and comments until after the next presentation.

Energy Efficiency and Local Authorities
Ms L Mohamed (Energy Development Group) was accompanied by Mr M Booi and presented on energy efficiency and local authorities. She discussed the importance of local authorities in implementing energy efficiency and the various ways they could further energy efficiency. She stated that the time was ripe to integrate energy efficiency into local policy and added that there was international and local pressure to this effect. She mentioned current initiatives underway in the areas of housing, transport, renewable energy, green building and public lighting. She stated that the barriers were lack of skilled personnel, a poor enabling environment and the existence of other pressing social development issues such as health, housing, water provision and sanitation. She added that social development projects could be bundled with energy efficiency to multiply the benefits. In conclusion, she stated that an enabling environment needed to be created and added that the Committee could assist the process by providing political and substantive support.

Discussion
The Chairperson commented on the unplanned housing development and stated that innovation was simply finding the simplest and best way of doing things. He further commented that what people needed was affordable/cheap, comfortable and healthy living and added that this was possible and the lack of innovation was failing to see the possibilities.

Mr E Lucas (IFP) asked for more specific cost figures from Ms Nkambule.

Ms D Motubatse asked for clarification on the sources of pressures mentioned in Ms Nkambule’s presentation.

Ms Nkambule responded by stating that pressure to integrate sustainable development principles came through sources of international funding, but stated that the most important pressure was from the local and grassroots level for the authority to look at the issue of housing.

The Chairperson stated that there was a lot for the Committee to follow-up on, thanked the presenters and adjourned the meeting.

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Appendix 1
WORKSHOP ON ENERGY EFFICIENCY AND DEMAND SIDE
MANAGEMENT
PROGRAMME

Committee Room V475, Parliament
30 August 2001
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8:45 Opening & Welcome – Duma Nkosi

9:00 Introduction to Energy Efficiency – Randall Spalding-Fecher, EDRC

9:45 DME position on Energy Efficiency – Sandile Tyatya, DME

10:15 Industrial Energy Efficiency – Mark Howells, ERI

11:00 Tea

11:15 Demand Side Management – Albert Africa, Eskom

11:45 Energy Efficient Lighting Initiative (Bonesa) – Barry Bredenkamp, Eskom

12:15 Energy Efficient Housing – George Chavdarov / Tlami Nkambule, IIEC

12:45 Energy Efficiency and Local Authorities – Leila Mohamed, Energy Development Group & Monwabisi Booi, Tygerberg Administration, (Globe SA)

13:15 Closure