Promoting public benefit energy-efficiency investment in new power contexts in South Africa (Final Draft)

Abstract

This research project has comprised various different outputs and activities. Firstly. we undertook a review and analysis of the impact that power sector restructuring has had on investments in DSM in selected countries around the world (namely, United States, New Zealand, England and Wales. Norway, Chile and Argentina, Brazil, Thailand, and Ghana). This review also investigated how these different countries have (or have not) supported investment in public benefit energy efficiency as more competition has been introduced into power industries. Secondly, we investigated barriers inhibiting investment in DSM in South Africa. We undertook this analysis from the perspectives of utilities' residential, commercial and industrial customers, Eskom, municipal distributors, and government. Thereafter, we undertook a scenario analysis to get a sense of what might happen to DSM investment as the power industry in South Africa was reformed. We looked at DSM investment in the context of the structure and ownership patterns of (i) the current structure of the power industry; (ii) when the electricity distribution industry (ED!) has been rationalised into a small number of regional electricity distributors (REDs), (iii) when competition has been introduced into the wholesale electricity market; and (iv) when retail competition is in effect. This report comprises the fourth, and last, research output for this project. It makes recommendations to the government, the National Electricity Regulator (NER), Eskom, and municipal distributors on how to ensure that public benefit energy-efficiency investment is well placed in new power sector contexts in South Africa.