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

1. “Creating a Sustainable Future: The Role of REEEP in accelerating REES in Southern Africa” Ms Amanda Luxande REEEP Secretariat for Southern Africa Townhouse Hotel, Cape Town. 25 May 2009

2. 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.

3. REEEP Vision and Focus • 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 acceleratesmarket development by addressing: • policy/regulation development and improvement • finance and business models • REEEP is driven by both a top-down and bottom-upapproach 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 accessto sustainable clean energy for the poor

4. 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)

5. An independent Analytical and Synthesis Study confirms the high effectiveness of REEEP programmes • 71% of projects rated highly successfulor 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. Project success vs. stated objective Source: Consortium Le Groupe-Conseil baastel Itée & Econoler International

6. E+Co West-Africa Modern Energy Fund Goals • Invest USD 12 million in Ghana, Mali and Senegal • Support and invest in 76 clean energy enterprises Main Activities • Finalize fundraising strategy • Negotiate with investors for grants and loans Main 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

7. 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

8. 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

9. 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

10. 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.

11. 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

12. 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

13. 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.

14. 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.

15. 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.

16. 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.

17. 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.

18. REEEP –SA Contact Details THANK YOU REEEP Regional Secretariat for Southern Africa SANERI Offices Sandton Johannesburg Tel: +27 010 201 4703 E-mail: amanda.luxande@reeep.org www.reeep-sa.org