Engaging private sector in energy efficiency |22 September 2020
The virtual engagement platform (Zoom) facilitated by the Sec on July 31, 2020 to discuss the different support extended to the private sector
Private sector is the synonym for money, economy and growth. They are the engines pulling us towards the progress of a country. Successful businesses play important role in job creation, revenue generation and funding the development in general. In a small island nation like Seychelles, private sector led growth provides ever-increasing share of essential services which can result in sustainability as well as generation of profit.
However, such a growth is possible only when the sector is encouraged or supported. The government provides such support through proper policy and legislations, to ensure private sector prosper while the benefits are reaped by all the citizens. The Seychelles Energy Policy for 2010-2030 identifies increasing Energy Efficiency (EE) as “the main contributor to sustainable development” and stresses the importance of improving EE as a means to cost-effectively reducing carbon emissions, and at the same time reduce the country’s dependence on importation of fossil fuel for energy generation. As per the Energy Report 2019, the domestic sector contributes for 33% of consumption with industrial users contributing 55% and government sector with 12%. The Seychelles Energy Commission (Sec), being the policy implementer, has already introduced policy measures such as Minimum Energy Performance Standards (MEPS) for electrical appliances especially focussing on the domestic sector with a spillover effect on the other sectors. In the domestic sector appliances such as, air conditioners, lighting, washing machines, freezers and refrigerators are major energy consumers. International research has shown there is a high correlation between increasing household income and increasing energy consumption in domestic households. As a high-income country, the Seychelles is experiencing increases per capita electricity consumption rise as nearly 100% of all households have access to refrigerator, washing machines and lighting. Targeted domestic energy efficiency activities can reduce this rise.
A complete market transformation cannot happen without a strong private sector engagement, which helps to achieve a market with high quality energy efficient products and services. Among various initiatives, Sec also works in close collaboration with SACREEE, the SADC Centre for Renewable Energy and Energy Efficiency in the implementation of EELA, Energy Efficient Lighting and Appliances in East and Southern Africa. This regional project aims to support the development of vibrant markets across the region. A preparatory phase of the project started in August 2018 and resulted among others in conducting baseline studies, developing the theory of change for the project, consulting stakeholders, developing implementation arrangements and partnerships and in the validation of the project intervention strategy. The full EELA project started in June 2019 with a duration of 5 years.
The EELA aims to create market and institutional conditions to enable a transformation of the sector to stimulate increased diffusion of efficient lighting products and appliances across all sectors. The project is focussing to bring regional support to private sector-led activities that will lead to increased use of high quality energy efficient lighting and appliances through regional regulatory and trade harmonisation interventions, while also considering inclusiveness of all project activities to assure socially sustainable project outcomes. Ultimately, the EELA project will increase access to modern energy services across various sectors and promote private sector involvement.
New business opportunities are coming up with a growing market for local companies and the EELA project provides support for innovative delivery models for energy efficient services and products such as those provided by Energy Service Companies (ESCOs) and other public-private partnerships or private
initiatives. One such support from EELA is the engagement of a private sector specialist to work on a private sector strategy based on issues encountered by them during this market transformation. The main objectives including protection of local markets from becoming dumping ground for inefficient technologies provide more choice of products for customers and incentives to encourage the sector to offer more EE services and products.
Despite the limitations posed by Covid-19, representatives from private sector of Seychelles participated in a virtual engagement platform (Zoom) that was facilitated by the Sec on July 31, 2020 to discuss the different support extended to the private sector. Some of the key drivers to stimulate private sector
engagement including establishment of regulations to create a conducive environment, adoption of harmonised MEPS in the region and supporting proven and innovative business models like leasing, Energy Performance Contracting, Cooling as a service and Lighting as a service were discussed.
The EELA Private Sector Support Facility will assist both the energy service providers and their potential clients distinguished under three categories:
1. Technical assistance for the design of Energy Service Business Models
2. Co-financing to support the upfront costs of equipment purchase
3. Technology transition support from the manufacturers.
The intervention strategy of EELA project is to stimulate an increased private sector participation to overcome existing barriers and enable large energy users such as utilities, commercial entities, governments or industries to get access to efficient appliances and equipment. The participants were informed that EELA would put a Strong focus on demand stimulation activities, including awareness
creation and the opportunities to collaborate with energy service providers such as ESCOs. We look forward towards their engagement.
Contributed by Sec