Overcoming barriers for the scaling up of EE appliances in Nigeria

Jason Yapp Oct 2011

Content 1. Lessons learnt 2. Energy Baseline scenarios 3. Barriers analysis 4. UNDP GEF EE Outcomes & outputs 5. Challenges
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Win-Win-Win Solutions
The Ghana Standard, GS362: 2001, label and test procedure for Room Air Conditioners was gazetted in December 2001
Save Ghanaian consumers an average of $64 million annually in energy bills. Average price increase 3%, 9% improved efficiency = Payback < 9 months In 2003 compliance with the standard freed up 13 MW of generating capacity By 2013 will be saving the equivalent of a 150MW generating plant. By 2020, this standard alone will be saving about 950GWh per year, freeing up nearly 250MW of generating capacity that can be used for other productive purposes, and that number will increase through 2030, all at net negative cost to the economy (virtual power generation). In contrast, the 200MW Bui hydropower plant is being constructed at a cost of nearly US$600 million. Carbon dioxide emissions will be reduced by about 2.8 million tons over 30 years (104,890 tons per year).
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 Population - 150 million Well endowed with oil and natural gas Largest emitters of GHG in Africa offgas flaring
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Energy Supply Challenges

PHCN

11 companies

Current Electricity Demand estimated at over 15,000 MW (Peak), 10,000 MW during off peak. Current Power Generation: 2,500 MW 4,000 MW Deficit 7,500-11,000 MW leading to frequent load shedding, poor access and energy poverty Caused by inefficient generation, interruptions in gas supplies, high transmission & distribution losses and non technical losses (pilfering and clandestine connection)
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Supply Challenges

Electricity demand is increasing at about 7% annually Focus on supply side management at the expense of demand side management Heavy reliance on diesel generators 60 million owners and cost USD 92 million per year Dirty, noisy and smelly Could this UNDP GEF EE project provides some solutions?
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Unreliable Infrastructure services

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Household income and electricity access

Lack of access to sustainable energy will impede economic growth and national development and increase poverty
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World Energy Development Index 2010

Malaysia= 0.83

Nigeria = 0.17

IEAs Energy Development Index is an average of four indicators: i) per capita commercial energy consumption (toe); ii) per capita electricity consumption (toe); iii) % population share of modern fuels (e.g. LPG, CFL, LED) and iv) % population share of access to electricity.

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Overarching Climate Change Strategy

National Development Priorities Vision 2020/NEEDS/President 7 Points Agenda

Danger
Mitigation
Energy Efficiency Industrial Emissions Reductions

Low Carbon, High Growth, Climate Resilient, Social Equity & Sustainable Development

Opportunity
Adaptation
Climate Resilient Human Development
Vulnerability and Adaptation Assessment

Low Carbon Path

Renewable Energy Energy Access

Natural Resource Management

ODS Phase Out

Energy efficient appliances and building

Methane capture/solar Hydropower

Diversified Livelihoods

Feed In Tariff

Decentralized/ Off grid

Adaptation Mainstreaming

Adaptive Habitat Conservation

Territorial Approach on Climate Change Climate Change Governance

Capacity Development and Resource Mobilization UNDAF and UNDP CPAP 2009-2012

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Myth and reality

Myth: When an appliance is left on standby, its off. Reality: Many people presume electrical products are off, when they are on standby. In this mode, they continue to consume power. Be especially wary of equipment that has a remote control: this is a tell tale sign that the equipment is on standby while waiting to receive the on signal from the remote. A red or green LED light is another tell tale sign. Myth: Its better to leave fluorescent lights on rather than turning them off when you leave a room. Reality: This consumes unnecessary energy. A fluorescent tube uses over five hundred times more energy if left on for fifteen minutes than the energy needed to restart it.
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Barriers to EE Investment

1. Policy and Regulatory

Lack of appliance standards and labels Highly subsidized electricity tariff no incentive to save Lack of metering no feel of electricity usage and opportunity cost is high Procurement policies favour lowest cost Import duties on EE equipment Unclear or underdeveloped institutional framework to support EE Lack of credible testing centre Poor enforcement (Custom and SON)
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Barriers to EE Investment

2. Appliance suppliers (MIDR)

Limited demand for EE goods and services Fluctuating voltages and load shedding Appropriate design (screw/pin, tubular transport damage) Affordability

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Barriers to EE Investment

3. End user Lack of awareness of EE Inferior imported EE products lack of confidence dumping ground Concept of energy savings is virtual cannot see Lack of incentives Lack of credible data Disempower to act and take informed decision Media unfamiliar with EE concept
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EE Governance for Market Transformation

4. Pilot CFL Enabling EnvironmentMarket Drivers 1.EE Policy & Legislation 2. S & L supported by accredited testing centres Appliances: CFL Street lights Refrigerators Air-conditioners Electric motors Water Heaters Pumps 3. Capacity Development Who? - Public/private sectors - Policymakers - Lawmakers - Industry - Commerce - Consumers What and how? - Awareness - Publicity - Media - Co-benefits - Life cycle cost analysis - Monetary and Energy saving - Carbon mitigation

Sensitized
Manufacturers Importers Distributors Retailers
EE Appliances Incentives Fiscal Microfinance Carbon

Well informed Low Carbon, Climate Resilient and Sustainable Consumers

ECOWAS Renewable Energy & Energy Efficiency Centre

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4 years Annual Work Plan

2011-2012 Outcomes OUTCOME 1: Enhancing the Capacities of all relevant stakeholders at the national level regarding the concept, nature and potential of energy efficiency in the residential and public sector Outputs Output 1.1: Energy & GHG savings potential for each main end-users in the residential and public sector validated Output 1.2: Develop an inventory for the monitoring and data collection system for end-use sales, energy demand and energy consumption Output 1.3: Awareness of the political and policy decision makers on end-use energy efficiency options and potentials for GHG reductions enhanced Output 1.4: Energy efficiency policy and legislation drafted and approved by Parliament 2012-2013 2013-2014 2014-2015
M J J A S O N D J F MAM J J A S O N D J F MAM J J A S O N D J F MAM J J A S O N D J F MA

Baseline Scenarios Quantify Co-benefits Strong Political Will

Law, Decrees, MEPS & Codes Accredited Testing Centres

OUTCOME 2: Output 2.1: National testing centres and DEVELOPME certification procedures for promoting energy NT OF NEW efficiency developed ENERGY EFFICIENCY Output 2.2: Pilot program launched to test and LEGAL finalize appropriate energy efficiency schemes REQUIREME such as energy labels NTS FOR A SERIES OF Output 2.3: National labelling content and format END-USE is designed, tested, validated and adopted EQUIPMENT IN NIGERIA Output 2.4: A relevant multiyear timetable is set to assure a coherent implementation

Design Labels
Labels tested and validated Labels implemented
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GfK Retail Panel Nigeria - Covered Channels 2010

Examples
GfK Panelmarket

Traditional Markets

Lagos
Computer Village GSM Village Ikeja Idumota Agege Alaba Apapa Oshodi Victoria Island

Abuja
GSM Village Neighbourhoo d Emab Plaza Wuze 2 Zone 3 Sharif Plaza Nyanya Maraba

Kano
Ibrahim Taiwo Road Beirut Road

Ibadan
Dugbe Sango

Aba
Ekeoha Shopping Centre Pound Road Ariaria St. Michael Road 300 Port Harcourt Road

Onitsha
Elector-mart Iweka Road

Kaduna
Ahmadu Bello Way Lagos Street

Port Harc.
Town Ikwerre Road

Benin
Ring Road Mission Road

Iwo Road
Ogunpa Challenge

Emeka Offor Plaza

Jerry O Plaza

Artillery/Aba Road
Olu Obasanjo GSM Village

New Benin

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Nigeria Panel Activities 2010

Covered Product Groups
Mobile Phones Smart phones CRT-TV/PTV (FLAT/Plasma) AHS DVD Refrigerators Airconditioners Washing Machines Deep Freezers Freestanding Cookers Lagos Abuja Kano Expansion to Kaduna, Ibadan, Onitsha, Aba, Port Harcourt & Benin City SINCE January January January January January January January January January January 2007 2007 2008 2009 2009 2009 2009 2010 2010 2010

Covered Cities

January 2007 January 2007 January 2008 January 2010

Audit Frequency Coverage

1.Monthly 2.Weekly (By Request) GSM 80%, CE 85%, MDA 85%

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Electrical Department Store in Lagos

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Monthly Sales Development

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Cumulative and monthly Sales Share Development By product segment

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Cumulative Sales Share Development By product segment and European Energy Label (coded if available)

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Metering study
Study 1 10 high/middle + 10 poor = 20 HH Monitor for 1 year seasonal impact

Study 2 25 high/middle + 25 poor in 6 geopolitical zones monitor monthly = 300 HH

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Minimum Energy Performance Standard

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Labels

United States Source: US Federal Trade Commission 16CFR305 Europe Source: European Commission Directives 2003/66/EC and 94/2/EC Korea Source: Korean Energy Management Corporation Australia Source: Australian Department of Energy Efficiency and Climate change
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4 years Annual Work Plan

2011-2012 2012-2013 2013-2014 2014-2015

Outcomes

Outputs

M J J A S O N D J F MAM J J A S O N D J F MAM J J A S O N D J F MAM J J A S O N D J F MA

OUTCOME 3: Output 3.1: Enforcement of the Energy Efficiency TRAINING OF PROFESSIONAL requirement (through Standards, Codes, Labels or a combination of them) for market transformation STAKEHOLDER S AND PUBLIC OUTREACH Output 3.2: The new regulations are understood and ACTIVITIES & adopted by local manufacturers, importers, appliances ENFORCEMENT distributors and the retail chain OF THE NEW ENERGY Output 3.3: Energy efficiency becomes priority in the EFFICIENCY purchase of any equipment LEGISLATION Output 3.4: A system for the monitoring of the impact of the new energy efficiency requirement developed. Regular updates of the legislation in order to tighten the energy efficiency requirement OUTCOME 4: Output 4.1: A large scale pilot project for Campaign TRANSFORM for Energy Efficiency Lamps completed. A minimum THE LIGHTING of million CFLs disseminated in household, commercial MARKET: and public services in partnership with Government of PROMOTION OF Cuba and ECOWAS ENERGY SAVINGS LAMPS (USD 400,000) Output 4.2: Financial incentives provided to pro-active local importers and traders to sale EE products Output 4.3: Provision for the recycling of compact fluorescent lamps with the recovery of mercury according to international best practices OUTCOME 5: PROJECT MANAGEMENT (USD 227,273)

S and L Enforced Creative Outreach Sensitized stakeholders Monitoring & Evaluation Learning by doing Incentives

Disposal
Project M and E
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Output 5.1: Project management and implementation support

Some facts

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Challenges

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Challenges

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Challenges

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ECN - Cuban CFL project

IBL Quan Monthly tity CFL energy Type of (milli ILB usag Differe consum light on) Savi usage e nce ption bulbs ILB CFL ngs (MW) (MW) (MW) (MWh) 60>14 W 0.8 60 14 46 15.8 3.7 12.1 3,421
40>8 W 0.1 40 8 100>18 W 0.05 100 18 20>5 W 0.05 Total 1.0 20 5 32 82 15 1.3 1.7 0.3 19.1 0.3 0.3 0.1 4.3 1.1 1.4 0.2 14.8 285 356 71 4,134

CFL monthly energy Monthly consum energy ption saved (MWh) (MWh) 798
57 64 18 937

2,623
228 292 53 3,197
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ECN - Cuban CFL project

2. Estimated expenditures i. Cost of 1 million CFLs (@ USD1.50 each) ii. Spot survey iii. Shipment and insurance iv. Clearing and transportation v. Publicity and Sensitization vi. Distribution and installations vii. Cuban experts viii. Monitoring and evaluation Total expenditure 3. Payback Total monthly saving Investment Payback (months) Naira
224,717,850 3,000,000 10,560,589 12,500,000 2,500,000 5,000,000 22,500,000

USD
1,498,119 20,000 70,404 83,333 16,667 33,333 150,000

3,000,000 283,778,439

20,000 1,891,856

101,181,455 2.8

674,543 2.8
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Co-benefits of CFL project

Million of CFLs installed Carbon savings (tCO2e) 1. Customers benefits and cost 1 233,400 10 2,334,000 30 7,002,000

Annual cost of electricity saved Incandescent cost avoided (USD) Total

1,534,500 1,000,000 2,534,500

15,345,000 10,000,000 25,345,000

46,035,000 300,000,000 346,035,000

2. Utility benefits and costs Total MW avoided from 1 million CFLs 38.9 Cost of power station development avoided (USD) 38,900,000 Annual fuel cost avoided (USD) 31,600,000 Total 70,500,000 3. National benefits and costs Avoided capacity cost (USD) Avoided fuel cost (USD) CDM revenue (USD) Total 38,900,000 31,600,000 2,334,000 72,834,000

389 389,000,000 316,000,000 705,000,000 389,000,000 316,000,000 23,340,000 728,340,000

1167 1,167,000,000 948,000,000 2,115,000,000 1,167,000,000 948,000,000 70,020,000 2,185,020,000

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EnerCap

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Reducing Peak Load

Whilst the adoption of energy efficiency technologies in the west is a matter of luxury, scaling up EE in Nigeria is a matter of survival. The opportunity cost is far too high to ignore!

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Mercury in CFL
Energy experts estimate that lighting makes up approximately 14 % of the average household's electricity account. As much as 80 % of that can be saved by replacing ordinary incandescent light bulbs with energy efficient compact fluorescent lamps (CFLs). Mercury, however, is an essential, irreplaceable element in compact fluorescent light bulbs (CFLs); it's what allows the bulb to be such an efficient light source.
This, however, raises a question about how safe and environmentally sound the use of CFLs is.

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Myth and reality

Myth: Screen savers save energy.

Reality: They are not designed to save energy. They help maximise your screens useful life. Some screen savers actually increase energy consumption.

Myth: Turning a computer on and off frequently uses more power and damages the hard drive.

Reality: The belief that frequent shut-downs are harmful persists from the days when hard drives did not automatically park their heads when shut off. Modern hard drives are not significantly affected by frequent shut-downs.
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Industrial Sector
Action needed from industry
Electricity usage optimisation needs to be driven by top management Participate in a voluntary 10% energy reduction programme some SA companies have already reduced by 10%

Identify opportunities for improved energy utilisation Process optimisation Technology improvements Shift usage to off-peak periods Participate in Eskoms demand saving programme Incentives available for energy savings projects Approval lead times improved considerably
Participation in Demand Market Participation Programme Incentives for hourly load reduction when tight system conditions prevail

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Adaptive Project Management

Policy makers and Lawmakers Nigeria GEF Focal Point (GEF FP), Federal Ministry of Environment (FME)

EE Steering Committee (EESC) to be Co-Chaired by FME (GEF FP) and UNDP ECN NERC PTFP NCEEC SON MAN EDAN CPC FOTE Terms of reference and meet at least twice a year

Implementing Agency and Secretariat of the EESC Energy Efficiency Unit lead by a Project Coordinator To be domiciled at ECN

UNDP Support
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Country Ghana

Equipment Type Room air conditioner & Compact Fluorescent Lamps Domestic refrigeration appliances

Establishment Date Labeling MEPS June 2005 2002

S & L in Africa
Type of Program Labeling MEPS Voluntary June Mandatory 2005 Mandatory June 2006 Voluntary Nov Voluntary 2009 Nov 2009 Mandatory June Mandatory 2010 June 2010 Voluntary Nov Voluntary 2009 Nov 2009 Mandatory June Mandatory 2010 June 2010 Voluntary Under consideration Voluntary Under consideration Voluntary Voluntary Voluntary Mandatory Mandatory Mandatory Mandatory Mandatory Mandatory Mandatory Mandatory Mandatory
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Nov 2009

Nov 2009

South Africa

Tunisia Egypt

Banning of manufacturing and importation of incandescent lamps, used refrigerator, freezers & AC CFLs Clothes Dryers Clothes Washers Cooktops and Ranges/Ovens Freezers Refrigerators Refrigerator-freezers Refrigerators Clothes Washers Freezers Room Air Conditioners Refrigerators

Nov 2009

Nov 2009

2003 2005 2005 2005 2005 2004 2003 2003 2003 2003

(2007) 2003 2003 2003 2003

Challenges
This is a timely and strategic interventions but how to
ensure continuity beyond the GEF EE project? Will the CFL programme in Nigeria help to reduce the peak demand and allow more citizen to gain access to electricity? How to empower the citizens to own the project and generate strong buy in to adopt a EE lifestyle? How will voltage fluctuation affect the success of the programme? What is the potential to replicate this programme across Nigeria and the ECOWAS region?
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Challenges

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Challenges

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Challenges

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Residential sector
Action needed from households
If youre not using it, switch it off. Hot water heater: Switch off geysers between 06:00 and 22:00, reduce thermostat to 60 degrees, insulate geyser and water pipes and replace geysers with solar water heaters using Eskoms rebate programme Lighting: Replace incandescent light bulbs with energy savers, and switch off lights in unoccupied rooms Bathing: Shower rather than bath as less hot water is used, and install an energy efficient shower head Climate control: Minimise use of air conditioners by first opening windows to allow cool air to circulate When using an air-conditioner keep the temperature setting between 18 22 degrees C Insulate ceilings to keep home cool in summer and warm in winter Pool pumps: Reduce the operating time to limit water circulation to twice a day and set the pool pump to operate between 24:00 and 05:00 Vampire appliance usage - Dont leave appliances in standby mode. Unplug cellphone charger Participate in the Power Alert programme on national TV (SABC and etv)

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Challenges

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Challenges

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Challenges

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Challenges
Economic incentives: phasing out subsidies, tax credits or feed-in tariffs for renewable power Target economic/fiscal measures: landfill, CO2 or fuel taxes Regulation and standards: energy efficiency standards, bio-fuel standards and electricity market regulation Market-based measures: green certificates and emissions trading Research and Development (R&D) for low-carbon technologies and demonstration projects

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Challenges

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Challenges

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Challenges

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Challenges

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