Improving the electricity efficiency in South Africa through a benchmark-and-trade system

Abstract

The improvement of energy efficiency is considered internationally as one of the ways to ensure energy security of supply, reduce greenhouse gas (GHG) emissions and mitigate the negative consequences of the climate change. In this paper, we propose a benchmark-and-trade system to improve the electricity intensity in South Africa in an effort towards the reduction of the country's emissions.This theoretical system is then used into a calculative application, as a simplistic example, with 2006 being the base year.The results show that the majority of the economic sectors will benefit by participating in the system. Also, the system has the ability to decrease the electricity intensity of the country without affecting its economic output.The findings indicate that, compared to the implementation of a carbon tax, this system gives the participants' stronger incentives to change their behaviour.