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IFC/GEF EFFICIENT LIGHTING INITIATIVE GLOBAL WORKSHOP Czech Rep., July 2000. ELI PERU. FRAMEWORK. ELI PERU. THE LEGAL FRAMEWORK. ELECTRICAL CONCESSIONS LAW. Non integrated generation, transmission and distribution activities with private participation.
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IFC/GEF EFFICIENT LIGHTING INITIATIVEGLOBAL WORKSHOPCzech Rep., July 2000 ELI PERU
FRAMEWORK ELI PERU
THE LEGAL FRAMEWORK ELECTRICAL CONCESSIONS LAW • Non integrated generation, transmission and distribution activities with private participation. • Splitted market: free - more than 1 000 kw regulated - public service • Competition conditions in generation, regulation in transmission and public service distribution. Efficiency incentives in these activities. • Capacity and energy generation prices differentiated by hours of consumption (peak and off peak). ELI PERU
THE LEGAL FRAMEWORK • SUPPLEMENTARY BY LAWS REGARDING: • Supervision and quality of service: establishing fines and penalties for bad service quality. • Anti-trust law: limit monopolistic property concentration; penalizes market abuse, assuring free competition. • Open access to clients to transmission facilities to assure competition. ELI PERU
MARKET ASSESSMENT ELI PERU
LAMPSANNUAL DEMAND 1999 15’741,010 3’613,951 1’934,179 272,430 Total 21’561,570 lamps ELI PERU
RESIDENTIAL LAMPSINSTALLED UNITS 15’852,730 5’058,090 4’350,280 1’580,380 Total 26’841,480 lamps ELI PERU
PUBLIC LIGHTINGINSTALLED LUMINAIRES Total 1’103,888 luminaires 19,415 453,615 630,858 ELI PERU
POTENTIAL MARKET ELI PERU
MARKET OBSTACLES ELI PERU
Incandescent price is $0.50, while the CFL price is over $10.00. • Low income C, D and E social economic levels represents 88% of total Peruvian population. • CFL repayment period, which is of six months, is unknown to the majority of the population. HIGH INITIAL COSTS ELI PERU
Saving & lasting time CFLs benefits are unknown to most low income population. • Color temperature (or light color) is taken as lighting quality, while quantity of flux is considered as good lighting. • Thick tube lamp is considered to produce a higher flux than a thin tube one. • Efficient lighting concept does not exist. LACK OF INFORMATION ELI PERU
Low income population does not have access to formal credit. • Consumer banking interest rate is around 180% annually. Clients’ bad credit experience. • Banks have low image and are considered unreliable in low income population. LACK OF RESOURCES AND FINANCING STRUCTURES ELI PERU
CFLs are available only at supermarkets, hardware and electrical stores. • Not available all countrywide. • Distributed mostly in high income population zones. • Standard and Triphosphor T8 lamps are not widely distributed. The same for electronic ballasts. LIMITED AVAILABILITY ELI PERU
Presence of unknown low price/low quality CFLs brands, without guarantee. • Forged known brands in the market. • Since last year, Indecopi has promoted the development of official CFLs standards. LACK OF QUALITY STANDARDS ELI PERU
CFLs PERCEPTION AND IMAGE BY CLIENTS • Since the massive CFLs introduction promoted by the Government in 1995 and 1996, many low quality brands entered the market. • Clients have had a bad quality experience with CFLs, with an early failure rate, higher consumption and lower flux than the rated values. ELI PERU
STRATEGY ELI PERU
Residential Sector: Distribution of CFLs through Electric Utilities Companies (E.D.E.s). • Public Lighting: Support E.D.E.s transactions for substitution of the existing public lighting equipment. • Professional Sector : Identification and support of Professional Lighting projects, and Generation of Energy Service Companies(ESCOs). MARKET SEGMENTATION ELI PERU
RESIDENTIAL SECTOR PROJECTS ELI PERU
PROBLEMS ON THE CFLs DISTRIBUTION PROGRAMS • Delay on the approval of Energy Efficiency Law. • Conception of some Ministry of Energy and Mines officials that Electric Distribution Utilities would earn too much and damage the market taking advantage of monopolistic conditions. • Lack of information among clients. • Low income of clients. ELI PERU
RESIDENTIAL PROGRAM PROJECTS • Agreements signed with: • Edelnor (EDN) – 748 697 residential clients • Luz del Sur (LdS) – 659 063 " " • Electrosureste (ESE) - 224 581 " " • EDN and LdS have agreed to participate in program with 1 000 000 lamps in the city of Lima. The date foreseen is september 2000. • ESE study to be made. Initial objetive 65 000 clients in the rural area. Quantity 80 000 lamps. • Other agreements to be signed: • Electro Oriente 80,000 lamps • Electro Ucayali 50,000 " • Grupo Gloria (4 Utilities) 200,000 " ELI PERU
EDE´S RESIDENTIAL CLIENTS ELI PERU
CFL’s COST STUCTURE ELI PERU
CFL’S FINAL PRICE ELIProgram Traditional Channel ELI PERU
PUBLIC LIGHTINGPROJECTS ELI PERU
PUBLIC LIGHTING PROJECTS A Letter of Intent has been signed to develop a public lighting feasibility study for the four electrical utilities of Grupo Gloria. ELI will co-finance the study with an estimated cost of US$ 32 600. A draft of the contract (MOU) is being reviewed. ELI Peru and Grupo Gloria will jointly supervise the study. ESE (Elec. Sur Este) has shown interest in this activity. ELI PERU
GRUPO GLORIA PUBLIC LIGHTING / ENERGY CONSUMPTON (MWh) & CLIENTS ELI PERU
PUBLIC LIGHTING PARTICIPATION ELI PERU
PROFESSIONAL SECTOR PROJECTS ELI PERU
PROFESSIONAL LIGHTING PROGRAM Marina de Guerra del Peru (Peruvian Navy) An agreement has been signed to perform an inventory at seven navy facilities. Objetive is to propose solutions for efficient lighting. Philips at ELI Peru’s request will make the diagnosis and the corresponding proposal. ELI PERU
NAVY SAVING POTENTIAL EST. NAVAL LA PERLA 251.20 kW BASE INFANTERIA MARINA 148.27 " ESCUELA NAVAL 443.09 " BASE NAVAL CALLAO 543.60 " EST. NAVAL SALAVERRY 94.07 " CENTRO MEDICO NAVAL N.A. CENTRO ESPAR. SN. BORJA N.A. 1386.16 kW ELI PERU