E4 Country Profile: Energy Efficiency in South Africa
Energy Efficiency in Emerging Economies (E4) programme findings and work
South Africa accounts for 12% of economic activity in all of Africa and 30% of electricity demand. Currently, it is one of the most energy intensive economies, at 0.179 ktoe per unit GDP (in 2015 USD PPP) compared with world average of 0.111. The current energy mix is dominated by coal and oil and accounts for 85% of the almost 50 GW of coal-fired capacity on the continent. The Government of South Africa intends to diversify its energy mix away from coal. It also intends to increase domestic vehicle production, including a target of 20% of vehicles manufactured being hybrid electric vehicles by 2030.
While there was a decline in energy efficiency in the period 2010 – 2014 contributing to 2% more energy use in 2014, this was reversed in the period 2014 – 2018. Coupled with a movement to less energy intensive sectors in the South African economy, this led to a lower energy use in 2018 despite an increase in economic activity.
Progress on energy efficiency in South Africa in 2018 was mostly achieved in the transport and buildings sector.
Currently, only 6% of South Africa’s final energy use is covered by mandatory energy efficiency policies. Coverage is highest in the buildings sector, at 21%, due to building codes and appliance standards.
Percentage of energy use covered by mandatory energy efficiency policies in South Africa, 2010-2018Open
There was no policy coverage in the industrial sector in 2018 as South Africa lacks standards for electric motors and mandatory efficiency improvement targets. Likewise, the transport sector had limited coverage due to the lack of fuel economy policies.
Although energy demand has increased by 30% since 2000, the Efficient World Scenario shows that energy use could be reduced to 4% below current levels. This would save USD 2 billon of household energy expenditure per year by 2040 with the largest savings being found in the transport (37%) and industrial (37%) sectors.
Energy savings in South Africa in the Efficient World Scenario vs the New Policies Scenario, 2012-2040Open
In the EWS Scenario, CO2 emissions could also be reduced to 25% below current levels by 2040.
Avoided CO2 emissions in the Efficient World Scenario vs the New Policies Scenario, in South Africa, 2012-2040Open
The opportunities to increase energy efficiency based on the Efficient World Scenario are:
- In transport, implementing vehicle efficiency standards would help unlock the greatest efficiency gains. Detailed analysis suggests that about 11 MtCO2 could be avoided by 2050, with a fuel economy standard of 95 gCO2/km.
- In industry, implementing MEPS for electric motors, a policy planned for the industry and mining sectors, will be an important first step to unlocking greater efficiency gains. Complementing this with measures that extend to the wider motor-driven system and other industrial equipment, including the implementation of energy management systems, could enable further savings.
- In buildings, strengthening energy management systems and standards for appliances, especially for cooling will allow South Africa to obtain the projected energy savings.
The E4 Programme has continued to support energy efficiency action in South Africa, collaborating with the government on the development of the National Energy Efficiency Strategy and advising on policy monitoring and target setting, drawing on IEA expertise in data collection, modelling and analysis.
In industry, the E4 programme is supporting the development of industrial energy efficiency indicators for energy-intensive and less energy-intensive sectors such as the automotive industry, which is of strategic importance to the government of South Africa because of its role in economic development and job creation.
In buildings, the E4 Programme has provided the Department of Mineral Resources and Energy (DMRE) and the South African National Energy Development Institute (SANEDI) with policy support for development of energy management systems through facilitating detailed technical dialogues with range of IEA member countries.