Recommended Strategy for an Integrated National Approach to EE Presentation to the Parliamentary Portfolio Committee on Energy 6 September 2012

Energy Efficiency How are we Doing? 2 Score Card SCORE Fact Base - Lacking Objectives - Arbitrary Strategy – None Implementation – Ad - Hoc

Contents 1.Status: A.Fact Base B.Objectives C.Strategy D.Implementation 2.Solution 3

Growth: Economic & Jobs Requires more energy Source: ExxonMobil Outlook to 2040

Improved Standard of Living - Requires more energy Source: ExxonMobil Outlook to 2040

Changing Energy Mix

RSA - Usage per sector Energy & Demand Sources: Frost & Sullivan & Eskom

Myth Busting - “Industry is inefficient due to low electricity prices”. Industry have for a long time been working hard to reduce their energy intensity & will continue to do so

Cost viz Potential: Setting Priorities

Need a Framework for Analysing Opportunity Specific Barriers

An example of “Addressing the barriers” in High Income Housing

Must Determine Potential: Probable, Doable & Most Likely Without serious economic Impact BACK UP

Residential and commercial: Potential savings levers and initiatives Without serious economic Impact

Bottom Up Fact Base Required Detail required for residential sector (Source: DSM Sector Analysis, Residential demand: 13,908MW, Residential consumption: 46,402 GWh) kitchen appliances (cooking, laundry and cool storage) water heating 18 lighting 5 other losses 15 4 household consumption (% contribution per end use) electricity consumption (% annual consumption) maximum demand (% maximum demand) residentialall other sectors residentialall other sectors 14

LSM 1 – 3 (number of appliances) Market segment 1 (~21% of households) And then by sector Type technologies and end uses varies across market segments (Source: Frost and Sullivan Market Analysis for Residential market 2012 LSM (number of appliances) LSM 8 – 10 (number of appliances) Market segment 2 (~58% of households) Market segment 3 (~21% of households) 54.1 m 4.1 m 6.5 m 22.1 m 10.7 m 0.09 m 1.2 m 2.4 m 44.4 m 3.2 m 5.0 m 11.2 m 5.5 m 0.8 m m 2011/11/ m 0.2 m 0.9 m 3.2 m 1.8 m m lighting geysersHVAC (heating and cooling) Kitchen appliancestelevisions Pool pumps Motors Fans

Contents 1.Status: A.Fact Base B.Objectives C.Strategy D.Implementation 2.Solution 16

Objective Setting An Iterative Process to find the right target in time 17 Actual Consumer Energy Usage Best in Class Best Known Technology Theoretical Best Compressible over time Not Compressible

Contents 1.Status: A.Fact Base B.Objectives C.Strategy D.Implementation 2.Solution 18

19 Step 1: Develop a thorough knowledge base Step 2: Refine policy options and set targets Step 3: Implement priority initiatives Step 4: Establish a long-term Energy Efficiency Programme Fact Base to Implementation In Integrated Phased Approach

Contents 1.Status: A.Fact Base B.Objectives C.Strategy D.Implementation 2.Solution 20

EE Road Map (Example Carbon Budgeting 1.Plot Base line Emissions and Inventory Plot the Three Emissions Outlook 2012 to Flagship Abatement Program 4.Develop and Agree GHG Data MRV Meta System 5.Develop National Reporting System (NEIS) "MRV" 6.Define Regulated Entities (Unique Generic Significant Activities) 7.Plot Macro Abatement Potential (Top Down) 8.Develop Sector Abatement Potential (Bottom Up) 9.Identify Assess Policy Suite Options 10.Assess and Select Policy Suite Options 11.Risk Assessments and Plans as Required 12.Develop South Africa Abatement Potential 13.Finalise Activity/Sector GHG Allocations 14.Finalise South Africa’s Draft 1 ST Country Budget Transitioning to a Low Carbon Economy 15.1 st Pass Country 2050 Scenarios - Transitioning to a Low Carbon Economy Jun Aug Sept Dec Jan Apr Jun Aug Sept Dec Jan Apr Jun Aug Sept Dec Urgent Next Steps Indicative only Still to be agreed Project

Contents 1.Status: A.Fact Base B.Objectives C.Strategy D.Implementation 2.Solution 22

Country Base Line Past Savings Opportunities Sector Base Line Past Savings Opportunities Services Base Line Past Savings Opportunities Facility Base Line Past Savings Opportunities Top Down Bottom up Simultaneous Top Down & Bottom up

24 CAMCO: Interaction between EE objectives and wider national development plans Energy efficiency objectives National and local spatial planning Transport planning Economic and industrial development Research, innovation and skills development Carbon abatement policies Built environment and human settlements Environmental policies and air quality management Policy Integration

25 Monitoring and Evaluation PlanningImplementation Monitoring and evaluation Review Development of Knowledge base, including baseline setting Formulation of Energy Efficiency Strategy & Action Plan Target setting Strategy and Action Plan review Target review Performance improvements and decision making Review of cost- effectiveness Project implementation Monitoring, reporting and verification systems Policy integration Data monitoring and analysisReporting of resultsTarget evaluation

Thank You