The Economic Impact of Electricity Price Increases on ... - Eskom
The Economic Impact of Electricity Price Increases on ... - Eskom
The Economic Impact of Electricity Price Increases on ... - Eskom
You also want an ePaper? Increase the reach of your titles
YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.
A comparis<strong>on</strong> <str<strong>on</strong>g>of</str<strong>on</strong>g> the electricity intensity <str<strong>on</strong>g>of</str<strong>on</strong>g> SA industries to their<br />
counterparts in the OECD suggests that there is significant scope for<br />
efficiency gains<br />
21<br />
Sectors<br />
<str<strong>on</strong>g>Electricity</str<strong>on</strong>g> intensity<br />
GWh/$milli<strong>on</strong><br />
South<br />
Africa<br />
OECD Difference<br />
Difference between<br />
OECD & SA<br />
Weighted<br />
relative to<br />
output<br />
difference<br />
Agriculture and<br />
forestry<br />
0.316 0.016 1870.90% 1242.4%<br />
Basic metals 1.095 0.111 887.30% 644.2%<br />
Chemical and<br />
petrochemical<br />
0.203 0.034 494.70% 462.9%<br />
C<strong>on</strong>structi<strong>on</strong> 0.002 0.087 -97.90% -155.9%<br />
Food and tobacco 0.021 0.023 -11.30% -7.8%<br />
Machinery 0.005 0.028 -81.20% -416.9%<br />
Mining and<br />
quarrying<br />
0.634 0.026 2305.60% 482.1%<br />
N<strong>on</strong>-metallic<br />
minerals<br />
0.524 0.02 2517.70% 3169.7%<br />
Paper, pulp and<br />
printing<br />
0.207 0.021 891.50% 1758.6%<br />
Textile and leather 0.067 0.01 548.80% 398.3%<br />
Transport<br />
equipment<br />
0.003 0.004 -20.10% -21.7%<br />
Transport sector 0.089 0.013 563.40% 505.7%<br />
Wood and wood<br />
products<br />
0.069 0.027 153.60% 162.5%<br />
Source: (Inglesi-Lotz & Blignaut, 2011)<br />
Scope for electricity efficiency gains<br />
Vulnerability <str<strong>on</strong>g>of</str<strong>on</strong>g><br />
sectors to rising<br />
electricity prices<br />
Scope for efficiency gains<br />
• This is particularly true in the n<strong>on</strong>-metallic<br />
miners, mining and quarrying, agriculture,<br />
paper and basic metals sectors<br />
• While a useful starting point, high-level<br />
comparis<strong>on</strong>s <str<strong>on</strong>g>of</str<strong>on</strong>g> electricity intensity across<br />
sectors may mask fundamental differences in<br />
the characteristics <str<strong>on</strong>g>of</str<strong>on</strong>g> the industries across<br />
countries – e.g. the c<strong>on</strong>structi<strong>on</strong> industry in<br />
South Africa is far more labour intensive than<br />
the industry in OECD<br />
• If South Africa is to remain competitive relative<br />
to its OECD counterparts under more stringent<br />
trade regimes, including carb<strong>on</strong> and climate<br />
change c<strong>on</strong>siderati<strong>on</strong>s, improvements in<br />
efficiencies will be necessary (Inglesi-Lotz and<br />
Blignaut , 2011)<br />
• <str<strong>on</strong>g>Electricity</str<strong>on</strong>g> efficient technologies can be costly<br />
and can take a l<strong>on</strong>g time to implement,<br />
especially within capital intensive sectors like<br />
mining.<br />
• A study by the HSRC (2008) found that the<br />
<strong>on</strong>ly short term energy saving opti<strong>on</strong>s<br />
available to the mining sector, which did not<br />
involve reducing output, were in the hostels or<br />
administrative <str<strong>on</strong>g>of</str<strong>on</strong>g>fices<br />
©2012 Deloitte Touche Tohmatsu Limited. All rights reserved.<br />
2