Energy Efficiency: Eskom

It is vital to have reliable and uninterrupted electricity for the South African economy to grow. Eskom is addressing this challenge by the expansion of supply options, a return to services program for three mothballed power stations and its Demand Side Management program.

South Africa’s marked economic growth in recent years has propelled electricity peak demand to rise at around 4% a year. Consequently, unless something is done, by 2007 peak-period demand will exceed Eskom's ability to supply electricity during these periods, and by 2010 additional base load capacity will be required. Eskom is addressing this challenge by the expansion of supply options, a return to services program for three mothballed power stations and its Demand Side Management (DSM) program.

Aiming to influence electricity usage patterns of electricity consumers, Eskom is implementing DSM in South Africa through collaboration with the Department of Minerals and Energy and the National Electricity Regulator. The DSM strategy comprises a dual approach: to reduce electricity demand at peak periods (07:00-10:00 and 18:00-20:00) by shifting load to off-peak periods and by overall electricity consumption reduction (24-hour reduction) by installing energy-efficient equipment and optimizing industrial processes. Sustainable DSM projects often involve a combination of both methods.

From small beginnings in 1991, starting with research, pilot studies and time of use tariffs, Eskom’s DSM program has grown into a concerted national electricity-saving effort officially initiated in the last quarter of 2002. DSM aims to achieve a market-driven business environment by 2007.

Eskom’s overall DSM target/objective is to save 4,255 MW over a period of 20 years to mitigate the negative impacts on the environment via energy efficiency targets and to support local job creation. There is currently an annual DSM target of 152 MW that will be increased to higher levels as the markets gain momentum in DSM implementation. This annual target is divided into energy efficiency and load management targets for the residential, industrial and commercial sectors.

The DSM program is comprised of the following program themes:

• Residential, commercial and industrial programs - Transforming the South African electricity market into an energy efficient industry.
• Public education - Increasing awareness about energy efficiency. The program includes a broad range of marketing and public relations activities, and feeds directly into programs in different income segments as well as residential, commercial, industrial and institutional program activities.
• Schools program - Highlighting the benefits and importance of using electricity efficiently to school pupils. DSM seeks to increase the awareness of students and faculties on energy efficient measures by providing participating institutions with resources packs, including teacher, learner and electricity audit guides.

• Savings of 197 MW were recorded during 2004 financial year – a major improvement from the 101 MW achieved in 2003 and exceeding the target of 152 MW by some 30%.
• The 197 MW was made up of 114 MW of energy efficiency and 83 MW of load management. It must be noted that South Africa’s electricity supplies are largely generated from coal-fired power stations consuming large quantities of coal and water while also emitting considerable quantities of greenhouse gases. For every 1 kWh reduced through energy efficiency implementation, there is approximately 1 kg of carbon dioxide that is not vented to the atmosphere while the power plants reduce water intake/consumption by approximately 1.2 liters.
• DSM’s successful marketing efforts saw a 10% increase in initial awareness levels among all target markets over 12 consecutive months.

• Reduced electricity demand during peak periods, thus delaying additional capital investment to further increase electricity supply.
• Improved value of electricity service to customers by reducing costs – customers have a wide range of energy efficient options and financial benefits.
• Conservation of the environment by reducing emissions and water consumption at power stations.
• Support of macro-economic development through job creation and improved productivity.
• Contribution to addressing the affordability of electricity to low income consumers.

• Demand Market Participation: On the Eskom Power Pool, customers are treated as generators and through a special tariff, demand market participation (DMP), they are encouraged to offer any flexible load onto the Eskom Power Pool.
• Co-generation: The NER has agreed that co-generation programs in industrial markets in particular through waste heat recovery or combined heat power are an efficient option and a cheaper alternative to supply side expansion.
• Residential compact fluorescent light bulb roll-out: DSM plans to provide 3,000,000 compact fluorescent light bulbs to communities in South Africa in order to reduce peak electricity demand too often related to residential lighting use. This initiative seeks to communicate and demonstrate the benefits of energy efficient lights, encourage their use and reduce energy usage.
• National roll-out of residential load management: This project is specifically aimed at the residential sector and largely targets geyser usage patterns in households. One of the programs launched to date involves the connection of ripple or radio-controlled units (or relays) to geysers, allowing them to be switched on and off by remote control. The main aim is to help consumers better manage their electricity consumption, particularly during peak periods, thus leading to cost savings for customers and Eskom.

Further information

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Author WBCSD Publication Date 26 Jul 2006 Document Type Case studies Issue/Topic Business Role/CSR Electricity Utilities Energy & Climate Energy Efficiency in Buildings Region Africa Country South Africa Company Eskom Holdings Limited Source Eskom Include In RSS WBCSD News & Updates		396 kb   207 kb