Municipal Revenue Impact from Energy Efficiency and Renewable Energy

The objective was to calculate the impact of customer energy efficiency and embedded PV on municipal revenue.

The Renewable Energy and Energy Efficiency Partnership (REEEP)-funded revenue impact project set out to quantify what the impact of renewable energy and energy efficiency into the future might be for three Metro municipalities in South Africa – Cape Town, eThekwini and Ekurhuleni. In addition the project determined what this revenue impact would have on service to the poor. The results are varied for the various municipalities and across each sector of the economy, however overall, the projected losses against business as usual ten years from now will be between 3 and 15%. The results also show that large scale energy efficiency implementation, most especially solar water heaters, is anticipated to have the greatest impact on municipal revenue. There are several methods to mitigate these losses, but the most effective strategy is a decoupling of electricity tariffs into fixed distribution and energy consumption charges, while still promoting these sustainable interventions.

Donor: Renewable Energy and Energy Efficiency Partnership (REEEP)
Project timeframe: 2013 - 2014
Project manager: Andrew Janisch