Presentation outline

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Presentation outline 1 -Confidential- Solar Water Heating Update Select Committee on Economic Development 25 January 2011 03/30/22

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Presentation outline. Solar Water Heating Update Select Committee on Economic Development 25 January 2011. Background. Presentation outline. Background. Presentation outline. Presentation outline. Experience with Tariff Based Rebate Program - Eskom. - PowerPoint PPT Presentation

Transcript of Presentation outline

Page 1: Presentation outline

Presentation outline

1-Confidential-

Solar Water Heating Update

Select Committee on Economic Development

25 January 2011

04/19/23

Page 2: Presentation outline

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

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Monthly income Rands

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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

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100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

1,000,000

25

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55

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75

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95

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1,0

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1,1

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1,3

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1,5

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1,8

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2,7

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7,5

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9,5

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Monthly income Rands

Nu

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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

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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

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4-Confidential-

Experience with Tariff Based Rebate Program - Eskom

04/19/23

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Comments from market on rebate programme

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“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

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** 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

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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

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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

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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.

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Provincial breakdown – Rebate Program

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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

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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.

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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

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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

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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.

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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

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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 ...

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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 ...

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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 ...

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Addressing the challenges ...

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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.

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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