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Presentation outline
1-Confidential-
Solar Water Heating Update
Select Committee on Economic Development
25 January 2011
04/19/23
Presentation outline
2-Confidential-
Background
Households number vs Income levels
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
25
0
55
0
65
0
75
0
85
0
95
0
1,0
50
1,1
50
1,3
00
1,5
00
1,8
00
2,2
50
2,7
50
3,5
00
4,5
00
5,5
00
6,5
00
7,5
00
8,5
00
9,5
00
10
,50
0
11
,50
0
13
,00
0
15
,00
0
18
,00
0
22
,50
0
27
,50
0
35
,00
0
50
,00
0
Monthly income Rands
Nu
mb
er
of
ho
us
eh
old
s
Non Electrified housholds
Electrified without a geyser
Electrified with a geyser
Upper income geysers• Market 1.38 million• Income > R16 000/month
Middle income geysers• Market 2.17 million• Income R6 000 - R16 000/month
Stove based water heating• Market 6.32 million• Poor/low/medium income market
Poor/Low income geysers• Market 1.38 million• Income < R 6 000/month • Indigent income market
No electricity• Market 1.24 million• Poor/low income market
Households number vs Income levels
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
25
0
55
0
65
0
75
0
85
0
95
0
1,0
50
1,1
50
1,3
00
1,5
00
1,8
00
2,2
50
2,7
50
3,5
00
4,5
00
5,5
00
6,5
00
7,5
00
8,5
00
9,5
00
10
,50
0
11
,50
0
13
,00
0
15
,00
0
18
,00
0
22
,50
0
27
,50
0
35
,00
0
50
,00
0
Monthly income Rands
Nu
mb
er
of
ho
us
eh
old
s
Non Electrified housholds
Electrified without a geyser
Electrified with a geyser
Upper income geysers• Market 1.38 million• Income > R16 000/month
Middle income geysers• Market 2.17 million• Income R6 000 - R16 000/month
Stove based water heating• Market 6.32 million• Poor/low/medium income market
Poor/Low income geysers• Market 1.38 million• Income < R 6 000/month • Indigent income market
No electricity• Market 1.24 million• Poor/low income market
Presentation outline
3-Confidential-
Background
Residential targets 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 By 2014 By 2019Upper income subsidy 16,500 27,500 55,000 66,000 71,500 71,500 82,500 66,000 66,000 27,500 236,500 550,000
150 litre SWH System 2,475 4,125 8,250 9,900 10,725 10,725 12,375 9,900 9,900 4,125 35,475 82,500200 litre SWH System 9,075 15,125 30,250 36,300 39,325 39,325 45,375 36,300 36,300 15,125 130,075 302,500250 litre SWH System 1,650 2,750 5,500 6,600 7,150 7,150 8,250 6,600 6,600 2,750 23,650 55,000300 litre SWH System 3,300 5,500 11,000 13,200 14,300 14,300 16,500 13,200 13,200 5,500 47,300 110,000
Mid/low income geyser 25,200 49,412 88,941 128,471 148,235 247,059 252,000 247,059 247,059 246,624 440,259 1,680,059Closed coupled 20,160 39,529 71,153 102,776 118,588 197,647 201,600 197,647 197,647 197,299 352,207 1,344,047
Split unit 5,040 9,882 17,788 25,694 29,647 49,412 50,400 49,412 49,412 49,325 88,052 336,012Non Geyser delivery 6,732 29,221 64,730 108,270 174,436 350,649 472,932 548,100 477,900 467,100 383,389 2,700,071
100lt Roof mounted 4,039 17,532 38,838 64,962 104,662 210,390 283,759 328,860 286,740 280,260 230,034 1,620,043100lt Pole mounted 2,020 8,766 19,419 32,481 52,331 105,195 141,880 164,430 143,370 140,130 115,017 810,021
55lt Pole with hand pump 673 2,922 6,473 10,827 17,444 35,065 47,293 54,810 47,790 46,710 38,339 270,007Insurance replacement 2,090 5,224 7,313 8,358 8,358 8,358 8,358 8,358 8,358 5,224 31,343 70,000Totals 50,522 111,356 215,984 311,099 402,530 677,566 815,791 869,517 799,317 746,448 1,091,492 5,000,131
Presentation outline
4-Confidential-
Experience with Tariff Based Rebate Program - Eskom
04/19/23
Comments from market on rebate programme
5
“We are currently averaging 100 – 200 per month (reflected in Eskom stats)” - One big national player
“Burst geyser is not good time to sell SWH”
“Rebate programme just isn’t doing it for market”
“Market needs a serious shake-up”
“It would be embarrassing to give you our sales numbers”
3126 installed on Eskom rebate from Jan 2009 – Apr 2010Average for new rebate level (Feb 2010 to April 2010) = 443 units per month
Presentation outline
6-Confidential-04/19/23
** August shows total figures since programme inception. August figures for residential and Low pressure not split Update October figures for Eskom’s Standard residential claims not yet available
Experience with new diversified approach
Cu
mu
lativ
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ota
l pe
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Presentation outline
7-Confidential-04/19/23
Municipal areas with active roll-out programmes (using Eskom rebate)
Municipality Roll-out Start date Installed as at 20 Jan 2011
NMBM 20-Jul-10 13006
Mossel Bay 27-Sep-10 300
Saldanha 4-Oct-10 500
Kroonstad 1-Sep-10 1800
Mangaung (Bloemfontein) 27-Sep-10 1800
Potchefstroom 27-Sep-10 1600
Theewaterskloof Oct 2010 600
Ethekwini Jan’ 2011 400
Ekurhuleni Dec’ 2011 500
Presentation outline
8-Confidential-04/19/23
Other projects - Solar Water Heating
Company Initiative implemented
BMW 6500 litre per day system
SABS Rosslyn Change rooms 8 units
Western Cape Environmental Affairs
1000 units (in Darling)
Japanese embassy Installed 410 solar panels which includes water heating needs
Hotel Da Vinci (Sandton) 30000 litre per day system
Presentation outline
9-Confidential-04/19/23
Market Activity: Rebated Solar Water Heating
As at 31 Dec 2010 there are presently: • 108 accredited suppliers, • 245 registered distributors and• 124 registered independent installers
• From April to December 2010, 26 768 units were installed whilst a cumulative total of 30 974 has been achieved since the rebate programme kicked-off in November 2008.
• The above figures exclude systems that have been installed but not yet claimed by programme participants.
Presentation outline
10-Confidential-04/19/23
Provincial breakdown – Rebate Program
Presentation outline
11-Confidential-04/19/23
Municipal breakdown – Fiscal Program• Program funded from 2009/10 fiscal allocations (via Eskom)
to install a total of 30 768 systems
• Tshwane (15 094), • Sol Plaatje (7 837) • Naledi (7 837)
• Additional funding in 2011/12 (via municipalities) to install more systems
Municipality Rm
Sol Plaatje 5.0
Sedibeng 54.4
Musina 54.4
Umsobomvu 60.0
Presentation outline
12-Confidential-04/19/23
What is in the pipeline? ...• Infrastructure structure challenges, especially water reticulation
& household plumbing are stalling the rollout especially in Naledi & Sol Plaatje
• Programme to address hot water provision in rural areas – Managed by Department of Rural Development and Land Reform.
• Programme to install in government owned residential dwellings – Managed by Department of Public Works.
• New building regulations will enforce energy efficient practices in new buildings (including SWH and other technologies). The regulation was gazetted for public comment and is in process of being signed off for promulgation by Minister of DTI.
Presentation outline
13-Confidential-04/19/23
What is in the pipeline? ...
• Tax incentive for implementing energy efficiency, as per the regulations issued under the Energy Act:• Concurrence of Minister of DTI obtained• Conditional concurrence of Minister of Finance obtained
Allows companies to fast track energy efficiency, including SWH through tax breaks
Presentation outline
14-Confidential-04/19/23
What is in the pipeline? ...Energy Efficiency and Demand Side Management Policy
(Standard Offer Model)
• Minister of Energy pronounced on a Standard Offer incentive scheme that will fund all Energy Efficiency and Demand Side Management (EEDSM) interventions through the electricity tariff.
• This scheme is aimed at creating an expanded opportunity for attracting the much-needed sustainable financial stimulus into the EEDSM programme.
• Initially the Standard Offer and the rebate programme will complement each other and merged over time
Presentation outline
15-Confidential-04/19/23
What is in the pipeline? ...
• New building regulations will enforce energy efficient practices
in new buildings (including SWH and other technologies such as
heat pumps). The regulation was gazetted for public comment
towards the end of last year and is in process of being signed
off for promulgation by Minister of DTI.
• Programme to install SWH in government owned residential
dwellings – DPW in collaboration with DoE.
Presentation outline
16-Confidential-04/19/23
What are the key challenges that will increase rate of rollout if addressed?
• Capital cost of components and systems is too high (pricing
ranges from R9000 to R35000 for a 200 litre system)
• Funding for capital costs of units
• Large uninformed consumer base i.e. lack of consumer
awareness of the solar water heating (SWH) benefits
• Funding for education and awareness campaigns
• Skills shortages – necessary for safe scaled up installations
Presentation outline
17-Confidential-04/19/23
Training
• Skills program initiated with CETA, eSETA, donors – unit
standards developed and accredited training available for
• NQF Level 4 : Solar Water Heating plumber
• NQF Level 2 : Hot water installer
Localisation
• Many companies supply Solar Water Units as importers or as
knock-down units and assemble locally. There are initiatives to
manufacture locally e.g. factory has been set up in the Eastern
Cape (East London IDZ). Discussions are also underway with
suppliers to set up other factories in Eastern Cape and Gauteng
Addressing the challenges ...
Presentation outline
18-Confidential-04/19/23
Localisation...
• Further CEF (Pty) Ltd. signed an MoU with a Chinese company for
setting up a SWH manufacturing plant.
• Preference will be applied for local systems when rebates are
applied for.
• DTI is spearheading the second Industrial Policy Action Plan (IPAP
2) process which encourages local manufacture of SWH.
• SABS is scaling up testing capacity, particularly in the regions, to
remove any bottlenecks the industry may experience in
launching new products
Addressing the challenges ...
Presentation outline
19-Confidential-04/19/23
Education and Awareness
• DoE has developed a comprehensive above-and-below-the-line
education and awareness plan. We are seeking partnerships with
labour, civil society and the private sector to execute the plan.
Funding
• Additional fiscal allocations applied for
• Tariff-based rebate cemented in Integrated Resource Plan (Nersa
will be compelled to make adequate rebates available in the
future)
Addressing the challenges ...
Presentation outline
20-Confidential-04/19/23
Addressing the challenges ...
Presentation outline
21-Confidential-04/19/23
Addressing the challenges ...Qualifications:
• At the end of 2008, new plumbing qualifications were developed to include the solar water heater training.
• A solar water heating installation uses three levels of plumbing staff:
• NQF Level 4 : Qualified Solar Water Heating plumber• NQF Level 2 : Hot water installer• Assistants/Helpers
• The aforementioned qualifications will come in handy for enhancing employability of the DoE’s Community Workers.
Presentation outline
22-Confidential-04/19/23
Conclusion• Target of 1 million systems by 2014 can be achieved, especially
when the electricity tariff doubles in 2013
• We will exceed threshold of 55 000 systems this financial year• Education and awareness building is critical for increased uptake• SWH is a key component of the industrial policy action plan to
create jobs and has to be intensified
Ran
ds
Illustrative affordability challenge