General InformationSouth African Export Development Fund (SAEDF) March 2009Kuyasacdm@telkomsa.net

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Location

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Location

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Solar Water Heater

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Solar Water Heater

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Overall view of light and SWH interventions

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Electrical interventions

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Sectional view of ceiling installation

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Ceiling installation - Public Works

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Background

Project Owner/client: Kuyasa Community-based Energy Services entity (to be formed)

Long-term finance, maintenance and democratic participation

Project Funder: Department of Environmental Affairs and Tourism (DEAT)

Project finance and management oversight

Institutional stakeholder: City of Cape Town (CoCT)Enabling and facilitating implementation

Implementer: South African Export Development Fund (SAEDF)

Day to day management of implementation, contracting of suppliers and labour

Players & functions

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Key aspects

• 2,309 houses (minimum)

• Budget shortfall underwritten by SAEDF

• Kuyasa community empowerment / investment / jobs /

ownership

• Sustainability and ongoing local contribution

Carbon finance, cost contribution and collection

• Complimentary initiatives

Greening

Support to community initiatives

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Kuyasa project outputs

• 2.82 Tons of Carbon Credits (1.2 for SWH) per

unit/per annum

• Total tons of 6,511 p/a. Income of approx R

780,000 p/a (at Euro10/ton)

• Ongoing communal income

• Skilled and semi-skilled jobs created for 60

persons - ongoing maintenance jobs and

business opportunities

• Modeling and informing future sustainability in low

cost housing

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• Energy poverty can be understood as limited access to and/or affordability of energy services thus affecting both energy choices and consumption patterns of poor households.

• Therefore due to energy poverty, the demand for energy services in these households is said to be “suppressed” =

• Because of poverty or lack of infrastructure energy service levels are below those that would otherwise have been consumed

• The unsuppressed level of consumption for houses without ceilings, with electric hot-water storage geysers and incandescent lamps can be predicted using calibrated theoretical models (baselines)

Suppressed Demand

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Suppressed Demand

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C Thermal energy required without ceilings and ceiling insulation

Outdoor ambient winter’s day temperature profile

Current level of space heating

Suppressed demand for thermal energy

Thermal energy required in houses with ceilings and ceiling insulation

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Benefits

Social• Respiratory health burden reduced• Provision of hot water – health / comfort• Household cost savings due to energy efficiency • Employment opportunities (EPWP)

Economic• Peak demand reduced – defers new installed

capacity • Leadership for low cost housing / energy industry• Entrepreneurial opportunities

Environmental• Largest project of its kind in Africa - Leadership• City SWH target – 10% by 2010 (ie 80 000

houses) Project assists this target• Implementing global commitments

Governance• Local participation and decision-making

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High level impact

• Placing energy poverty in low income housing

firmly on the national agenda

• New roll-out and replication

• Local manufacture / improved technology Solar energy adaptation

Open Vented Solar Water Heater Balanced pressure Tempered water Quality / Longevity Water-wise Easy maintenance Low cost

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“I never thought a poor person like me could have a solar geyser.”

“We are warm now, we are saving, we don’t get flu as often. Life is much easier.”

“I get a lot of visitors now – no one can laugh at my house.”

“The project has given the people of this community dignity.”

“The project brought skills and jobs for young men, they don’t hang around street corners anymore.“

“Our children are much safer now, no more hanging wires.”

“The project makes us proud.”

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What will it cost?

Collection of contributionMonetize basic electricity grant

New Technology

Rebate Existing Technology

Nett Additional Cost

Solar Water Heaters

6,500 2,500* 4,000

Ceiling Insulation

3,392 0 2,282 1,110

Wall Insulation

799 0 0 799

Floor Insulation

657 0 0 657

Total 6,566

Source: Quantity Surveyor estimates based on current Solar Water Heater and Thermal Efficiency Technology and standard specifications. * Based on a similar Solar Water Heater currently on the Eskom Solar Water Incentive.

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Can we afford to do it?

Carbon financeDSM financeEskom SWH subsidy

Collection of contribution

Public works

Monetize basic electricity grant

Can we afford not to?

Sustainable model delivering on the critical imperatives:

Service delivery / Poverty alleviation

Micro economic benefits at household level

Economic co-benefits

Health

Job creation / skills development

Macro economic benefits

Avoided new power generation

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Finance for large-scale roll-out

Commercially viable to finance and roll out SWHs in low-cost housing on a large scale through a combination of:

• Hot water supply - monthly payment

– Collection through pre-paid electricity

• Demand side finance

• Eskom SWH subsidy

• Carbon finance - programmatic CDM

• Public works (labour and local skills development)

Large scale roll-out of alternative energy possible

• Ensuring pro-poor service delivery and poverty alleviation;

• Supplying community ownership, jobs and ongoing

maintenance;

• Supplying commercially viable development through

public/private partnerships.

Some final notes• Many small sources of emissions make

transaction costs high• Cost R30m in implementation costs• R200 000 for verification (awaiting

completion)• 95% completion awaiting final DEA payment• Scale… Government investment and

ownership of CERs• Suppressed demand needs to be included in

methodological approach for replication• NAMAs may be more appropriate

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