Responding to the National Energy Crisis - The Energy Game-Changer Process

Lance Greyling- Director: Trade and Investment, City of Cape Town

www.capetown.gov.za 2

The City Recognises the Impact of the Energy Crisis

• The impacts are being felt all over the City

• Our economy is suffering from lost production

• Some sectors are severely impacted upon

• The cost of unserved energy is R75 kwh

• Security concerns, particularly in poorer

communities

• Chasing away investment and dissuading

current businesses from expanding their operations

ENERGY SECURITY DESIGN LAB

Problem statement

“What can the WCG, City and local municipalities

do to enable all actors to help minimise the

impact of power shortages and load shedding

on the Western Cape economy and jobs over

the next 5 years?”

Key contextual considerations in seeking

solutions

• Constitutional mandates mean there are limited levers

within direct control of provincial and local government in

SA (but there are some, and mandates are open to interpretation!)

• Energy security, affordability, municipal financial

sustainability, job creation and environmental sustainability all need to be considered

Government can help in 2 ways

1. Using things within their direct control to minimise the impact of the crisis

– Load shedding approach and schedule design

2. Enable/drive customers (business and residential) to implement useful solutions

– Clear, simple rules

– Incentives (pricing, subsidies, etc)

– Availability (single point of contact) and responsiveness

Influence and buy-in

• We need to engage with other regions/cities to find

solutions that are replicable and have broad support – to

succeed this cannot be a Western Cape agenda!

• We need to find load shedding solutions with Eskom as

City and Eskom supply areas in Cape Town are adjacent

and consistency will be key to customer buy-

in/acceptance

Load shedding stage

Demand reduction (%)

Demand reduction (MW)

(COCT)

Demand reduction (WC)*

Stage 1 5% 80MW 130MW

Stage 2 10% 160MW 260MW

Stage 3 15% 240MW 400MW

* Assumes COCT supply area is ±75% of CT demand and CT represents ±80% of WC elec use

We are are solving for hundreds of megawatts

CITY’S PRIORITIES & PLAN TO MITIGATE THE IMPACT OF LOAD-SHEDDING

Framing

• No silver bullet, but there are a number of things that jointly can help get us out of this

• Optimizing for long term solution when making immediate solutions

The City is committed to exploring 10 priority actions

• 4 levers with immediate impact

• 6 things to enable short to medium term solutions and improvements to energy security

Immediate levers

1. Load shedding certainty to enable businesses to plan better

e.g. Commitment to Stage 1 or 2 load shedding for the month whether it is needed by Eskom or not

Immediate levers

2. Use City-controlled levers (e.g. pumped storage, geyser control) to help avoid or mitigate load shedding

Immediate levers

3. Load shedding schedule design

Immediate levers

4. Contracted demand response to avoid or mitigate load shedding

Short- to medium term solutions

5. Try and agree a baseline with Eskom

Short- to medium term solutions

6. Incentivising rooftop PV

Short- to medium term solutions

7. Direct power purchase agreements (PPAs) with independent power producers (IPPs) for renewables and gas

Short- to medium term solutions

8. Solar water heaters and heat pumps

Short- to medium term solutions

9. Time-of-use tariffs e.g. investigate cheap night time power to enable load

shifting through battery systems

Short- to medium term solutions

10. Show leadership with our own energy use

For more information

Contact: Lance.greyling@capetown.gov.z

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Thank You