Planned activities

1. Industrial Energy Efficiency Project - SAOverview of Phase I OutcomesAlfred Hartzenburg 21 July 2015

2. Philippines Egypt Indonesia Iran Ukraine Colombia Macedonia Myanmar South Africa Moldova Russia Turkey Ecuador Malaysia Thailand Viet Nam India Operational IEE – A Global Programme Operational in 17 countries Planned activities in 10 countries Planned activities Other donors • Swiss State Secretariat for Economic Affairs • UK Department for International Development • Government of South Africa • Government of Italy

3. Training Statistics • >210 Training workshops conducted • >3 000 Engineers, technicians and managers trained • 119 National Experts • 46 National Trainers • 29 ISO 50001 Lead Auditors

4. Industry Engagement * Some of the 54 Actively Reporting Companies has signed to be Demo Plant for more than 1 Discipline

5. Industry Engagement

6. SME Energy Audit Trends

7. Implementation Savings Reported

8. Actual Savings (Payback Period less than 2 years)

9. Performance Summary

10. Implementation Drivers

11. Implementation Reality

12. Accelerants to Implementation Required Implementation Aid

13. Behavioural Economics

14. Reflections • Sub-metering pays dividends when verifying the performance of energy conservation measures (esp for bottom-up sanity checks) • Develop a strong measurement plan to verify results and see that it gets implemented • Energy savings from operational improvements are not permanent. Savings when plants are down evaporate when plants get busy.

15. Winning Culture and Environment • Demonstrable and visible top management commitment • An ISO / WCM environment promotes a culture conducive to sustainability • After exhausting no cost improvements a willingness to spend in order to save • Plant stability and reliability • Allocation of resources

16. Sustainability Failure • Energy cost proportionately low • Limited resource allocation • Low level of operator awareness and interest • Top management unaware and / or disinterested in energy team achievements and challenges • Competing and disruptive reporting priorities • Savings not sustained

17. Sustainability Failure ”…energy efficiency initiatives that are not monitored and maintained typically have a six-month half-life of their benefits. That is, they lose half of their economic benefits every six months if left largely untouched.” Emerson’s James Beall, a principal process control consultant who helps manufacturers optimize their processes

18. Results of SA IEE Project interventions • Solomon Coatings: The company implemented theIEE Project SME energy assessment findings which turned the company back to profitability. The company saved around R 6,500 per month over a period 10 months in electricity costs with a resultant increase in production output of 40%. • Sockit Manufacturing: The IEE Project identified four energy system optimisation opportunities and a fuel switch, all of which the Company implemented. The Company installed a paraffin boiler which allowed it to increased its machine pool by 30% . • Willard Batteries: By implementing an EnMs, supported by the IEE Project, the Plant has saved over R 3 million between 2012 and 2013. As a result of the energy savings the Plant has been expanded with 20% in production capacity. • Mittal Saldanha: The IEE Project has directly assisted Mittal Saldanha to improve its energy efficiency and reduce production costs. It has facilitated the company saving approximately R 89 million n 2011 in energy costs, helping them to remain in business. SA IEE Project Outcomes SA IEE Project Outcomes SA IEE Project Outcomes SA IEE Project Outcomes Direct Jobs retained Direct Jobs created Total Direct Jobs 1 0 416 1 237 4 20 66 0 5 20 482 1 237 *Outcomes largely attributed to the IEE Project’s interventions, but acknowledging that other variables would have influenced the outcomes to varying degrees across the study sites. Tot Direct Jobs retained = 1654 Tot Direct Jobs created= 90 Overall Direct Jobs = 1744

19. Mapping Disposable Income* *Calculations in this slide are based on IEE Direct Local Employment = jobs crated/retained as a direct consequence of the IEE Project interventions. Disposable annual income earned by workers (IEE direct employment) living in the local community (excluding bonuses and overtime and after deductions and tax) $ Disposable Earnings R 206.3 mill Percentage earnings within local community R 25 mill Income retained p.a. in local community to generate further economic activity 72% $ R 42 000 1 Arcelor Mittal Steel Saldanha Works Disposable Earnings R 64.6 mill R 90 000 2 R 5 mill Disposable Earnings R 0.25 mill 1 Solomon Coatings 48% Disposable Earnings R 0.7 mill 2 75% Sockit Manufacturing Willard Batteries

20. Acknowledgements • Project Funders: dti, DoE, Seco, UKAid • Implementing Agent: UNIDO • Project Host: CSIR • Project Custodian: NCPC-SA • Skills Development: Wynand Van Der Merwe, Sybil Rowles, Phyllis Manamela • Marketing & Comms: Julie Wells, Fatimah Boltman, Constance Mokhoantle • IEEP Project Team: Faith Mkhacwa, Sashay Ramdharee, Milisha Pillay, Ngoanathari Maja, Bianca Latchman, Ajay Trikam, Brent Goliath, Adrian Rudolph, PhumlaMakae

21. Key Milestones & Challenges • IEEP Phase II • National Energy Act 2008: Energy reporting • National Energy Strategy • Carbon Tax • ISO 50002, 50002, 50006, 15015 • Reliable Power Supply • …

22. thank youany questions?Alf Hartzenburgahartzenburg@csir.co.za www.iee-sa.co.za