“Creating a Sustainable Future: The Role of REEEP in accelerating REES in Southern Africa”

“Creating a Sustainable Future: The Role of REEEP in accelerating REES in Southern

Africa”

Ms Amanda LuxandeREEEP Secretariat for Southern Africa

Townhouse Hotel, Cape Town. 25 May 2009

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Presentation Outline

Introduction and background to REEEP.

Effectiveness of REEEP Programmes globally

REEEP’s programmes in Africa: Renewable Energy Applications.

Recommendations: The Status of REES in Southern Africa.

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REEEP acts as a market facilitator by reducing market barriers for renewables and energy efficiency systems, with particular focus on emerging markets and developing countries

REEEP accelerates market development by addressing: policy/regulation development and improvement finance and business models

REEEP is driven by both a top-down and bottom-up approach to meet the real needs on the ground

REEEP works with governments as well as with the private sector

REEEP is committed to the achievement of MDGs and aims to improve access to sustainable clean energy for the poor

REEEP Vision and Focus

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Well established regional and global networkthat is growing continuously

270 partners including: 42 governments all G7 countries 3 “plus 5”countries

(Brazil, SA, Mexico) states and key agencies from

China and India (NDRC, IREDA) development banks and

international organisations 3000 friends of REEEP Currently funded by 13 governments

Austria, Australia, Canada, Germany, EU, Ireland, Italy, the Netherlands, New Zealand, Norway, Spain, US, and UK (REEEP’s major donor)

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An independent Analytical and Synthesis Study confirms the high effectiveness of REEEP programmes

71% of projects rated highly successful or successful v. their stated objective

REEEP developed good practices in providing renewable energy and energy efficient services to the poor Promotion of ESCO schemes and

working with small and medium sized businesses are particularly effective

Stakeholder participation is a central feature of REEEP projects and an instrumental factor in successes

REEEP is a relatively small player in the countries and sectors where it acts, but has proportionally high results for the level of funds disbursed

Projects often have the desired catalyst effect in market development.

Successful48%

Highly Successful23%

Unsuccessful10%

Moderately Successful

19%

Project success vs. stated objective

Source: Consortium Le Groupe-Conseil baastel Itée & Econoler International

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E+Co West-Africa Modern Energy Fund

Goals Invest USD 12 million in Ghana, Mali

and Senegal Support and invest in 76 clean

energy enterprisesMain Activities Finalize fundraising strategy Negotiate with investors for grants

and loansMain Outputs SMEs providing access to clean,

reliable and affordable energy services

Catalyzing financing value chain Over 3 million people served Carbon offsets of over 2 million tons

annually

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E+Co West Africa Modern Energy Fund

To provide energy for 3,191,489 people, reduce CO2 emissions by 2,112,676 tons annually and mobilize third-party capital of $120,000,000

Establishment of an investment fund to invest $12,000,000 in 76 clean energy SMEs in Ghana, Mali and Senegal,

Over the total operational period of 10-12 years, 12.8 million people will receive better energy supply through investments initiated by this fund

Replication of this fund to other E+Co regions, mainly South America and Mekong

Project Partner: E+Co

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Developing a Rural Integrated Energy Utility (IEU) Roadmap in South Africa, Tanzania and Uganda

Integration of thermal and electrical needs and also energy efficiency concerns into an Integrated Energy Utility (IEU) concept.

Replicable IEU guidelines and reference materials for governments, regulators, donors and investors

Development of a financial model and business plan for the IEU

Project Partner: Restio Energy

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Developing a Vehicle for Solar Water Heater (SWH) Mass Implementation in South Africa

Reduction of peak power need, leading to enhanced energy security and financial benefit for the urban poor

Implementation of a fee-for-service business model to roll out SWH in at least three Cities in South Africa

Provide technical, legal and financial assistance to key stakeholders in these cities by using and amending the REEEP manual for RE/EE options

Project Partner: SEA

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Financial Risk Management Instruments for Supporting Energy Services Development Investment in Sub-Saharan Africa

Financial risk management instruments for the financing of small-scale energy equipment and service delivery projects in Ghana, Mali, Senegal, Tanzania and Zambia

Supporting multilateral initiatives designed to improve RE/EE use

Achievement of maximum leverage of donor funds

Increased energy access for the poor through the promotion of RE and EE

Project Partner: Econoler Int.

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Promotion of Solar Water Heating (SWH) in Uganda

Peak shaving of 1 MW from the Ugandan grid by installing 500 SWH

Train engineers and technicians to develop local capacity and run an awareness campaign for SWH

Policy document, standards code and installation manual for solar water heaters

Investment plan for scale-up and implementation

Project Partner: MoEMD

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Improving Electricity Governance in Brazil and South Africa

Improved government and regulatory capacity to implement legislation that promotes RE and EE and social welfare

Convening a coalition of civil society, regulatory commissions, government, legislators, and utility representatives

Identification of weaknesses in policy and regulatory processes

Recommendations on how to address these weaknesses

Improved understanding of regulators and policy makers of how better governance can help build political support for RE and EE

Project Partner: WRI

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Barriers to the deployment of Renewable Energy and Energy Efficiency Systems

Poor level of regional co-ordination.

Ad hoc/ poor quality of long-term energy planning.

Insufficient financing/investment into RE to support planning.

Insufficient infrastructure, skills and capacity to implement RE programmes in the region.

Challenges are somewhat defined but key issue = implementation.

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Regional Perspectives: Context in Southern Africa

Key challenge: increasing access while mitigating against the economic costs of a supply crisis

Status of REES in Southern Africa: Market feedback mechanisms not well understood. Patchy/Uneven development. Low levels of energy access. Energy intensity and carbon footprint is high because of the reliance

on coal. Electricity supply crisis.

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Recommendations

Well co-ordinated plans amongst relevant stakeholders in RE and EE.

Current support mechanisms such as feed-in tariffs and CER’s/VER’s need to be reviewed and optimised.

CDM procedures must be simplified to make carbon funding more easily accessible.

Concrete funding committed to long-term energy master plans to increase confidence in markets and partnerships.

Stability in investments: governments required to provide long-term confidence for investment into RE.

Integration of energy requirements within all spheres: Gov Depts., institutions, households and all sectors of industry.

Increased focus on regional projects and develop projects to supply entire regions i.e. lowered costs of construction and operation as smaller projects likely to be expensive to build and costs borne by individual countries.

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Concluding Remarks

Regional co-ordination necessary for successful uptake of RE in terms of Common policy development and modes of

implementation (including legislations) Common regulatory approaches and frameworks Common regional trading mechanisms for physical

power and RE support mechanisms Commitment to regional co-operation from key

institutional stakeholders to support initiatives for RE in Southern Africa

To set common targets for RE for the region. Regional Co-ordination remains an important part of

working towards a low carbon future e.g. SADC ETG.

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Concluding Remarks cont…

Governments ultimately play a crucial role in setting the legal, policy, trade and finance conditions necessary to encourage the uptake of RE and EE.

RE provide energy security and climate change security: Protects countries from fluctuating oil prices – less spent on

expensive oil imports or leaves more oil for export thereby increases a country’s export revenues

RE offers great opportunities for social and economic development:

Job opportunities. Achieving MDG goals through energy access which

alleviates poverty.

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REEEP –SA Contact Details

THANK YOU

REEEP Regional Secretariat for Southern AfricaSANERI Offices

SandtonJohannesburg

Tel: +27 010 201 4703E-mail: [email protected]

www.reeep-sa.org