Energy efficiency and Demand Side Management Program ... - Eskom

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Strategic positioning and restructuring of national economy: Potential for global leadership and export of key energy technology(ies); contribution to emerging Green Economy Strategy; alignment with broader transition to a low carbon economy; Economic aspects Technology Equipment Operation Performance Economic issues of a program (e.g. Cost, local content, financial/price risk, financing prospects, strategic positioning and restructuring of national economy, etc.) Items which might be considered in scoring (e.g. pre‐ and post‐ implementation data and impact from the program (savings, etc.)) Scores (out of 100) Weighting factors (in percentage) Subtotal score 6.1.5 Financial Viability Table 4 Program evaluation of economic aspects Assessing the financial viability of a project or a program is primarily concerned with the direct project costs and involves setting up a project plan and budget and determining the intended investment in assets. Project income statements and balance sheets will aid the project manager to assess the viability of the project in the usual way. Assessment of the financial viability of a project is normally done by an expert well versed in all the contributing factors of an evaluation and we recommend that experts be used in order to ensure that the assessment is enforceable. 6.2 Understanding Evaluation Results by Comparison Matrices 6.2.1 Comparison Matrices Program evaluation panel can select important issues for evaluation, and prepare the above four tables for evaluation, in conjunction with the financial viability study. After the scoring of the five figures on engineering, environmental, social, economic, and financial aspects, a comparison matrix can be further established to understand the output from the program. Table 5 serves as an example of such a comparison matrix, where it can be read, for the impact from this program, that for every MWh saved, there will be 20/500=0.04 job∙year created; and similarly, for every ton of CO2 reduced, there will be 0.02 job∙year created. It shows also that the cost for each created job∙year is R10000/20=R500. The figures in the table could be ones taken from the previous four tables and the financial viability study. The figures in Table 5 are indicative. 16
Energy saved (500 MWh) CO2 reduction (1000 tons) Number of jobs created (20) Economic growth (R25000) Project cost (R10000) 6.2.2 Decision Matrices Energy saved (500 MWh) CO2 reduction (1000 tons) 17 Number of job∙year created (20 job∙year) Economic growth (R25000) 1/1 500/1000 500/20 500/ 25000 1000/500 1/1 1000/20 1000/ 25000 Project cost (R10000) 500/ 10000 1000/ 10000 20/500 20/1000 1/1 20/25000 20/ 10000 25000/500 25000/1000 25000/20 1/1 25000/ 10000 10000/500 10000/1000 10000/20 10000/ 25000 Table 5 An example of a comparison matrix After the subtotal scores of the program have been given from the engineering, environmental, social, economic, and financial aspects, then each of the five subtotal scores are multiplied with a corresponding weighting factor, and the products are summed together to find the total score for the program. This process is illustrated by the following decision matrix in Table 6 which is used to help the decision‐making of stakeholders. Engineering Environment Social Economic Financial Subtotal scores Weighting factors (in percentage) Total score Table 6 Calculation of total score for program evaluation The comparison and decision matrices are useful tools to compare and rank competing and progressing projects. Care should be exercised when yes/no questions are used to qualify/disqualify the project proposals. In such cases, a special notation could be used in the comparison and decision matrices to denote the status, such as . 7 M&V Process for Implementation of An EEDSM Program The above POET based EEDSM program evaluation methodology provides a general evaluation guidelines for both the program evaluators and the program developers. Note that usually EEDSM programs are developed by contracted energy analysts, or the so‐called Energy Service Companies (ESCos). As the customer contracted program developer, an ESCo needs to make thorough 1/1
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