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Draft 2Nd National Energy Efficiency Action Plan For

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Draft 2Nd National Energy Efficiency Action Plan For DRAFT 2ND NATIONAL ENERGY EFFICIENCY ACTION PLAN FOR THE REPUBLIC OF ARMENIA Renewable Resources and Energy Efficiency Fund World Bank / Global Environmental Facility Government of Armenia Astghine Pasoyan, Team Leader 8,000 7,708 TPES TFEC Energy Efficiency – why care? 7,000 ktoe 6,475 • 2/3 of all energy resources imported 6,000 • Emerging supply gap: 5,000 4,681 4,139 • 4,000 3,518 Demand grew and forecasted to grow further, 3,286 3,378 2,991 2,977 2,738 existing supply capacities insufficient to meet the 3,000 2,512 2,134 2,106 growing demand 2,015 1,901 1,964 1,858 1,858 1,905 1,998 2,000 1,714 • Future demand supplied by aging capacities to 1,107 require 2-3 times more TPES 1,000 - • Energy price hike in the last decade 1990 2000 2005 2010 2011 2012 2014 2015 2017 2018 2020 poses affordability and competitiveness 300% Energy price increases: Gas & Electricity 251% 251% 251% problems 250% Day-time electricity Tariff 208% 208% 208% 206% 206% • Electricity price rose by 94-112% Night-time electricity tariff 206% 200% Retail Gas Tariff 172% 159% 159% • Natural gas price rose by 200-250% 159% Wholesale gas tariff • 150% 112% Armenia’s economic indicators dragging: 112% 94% 94% 94% 88% 87% • Global competitiveness index dropped from 117 100% 86% 67% 65% 65% to 85 during 2013-14 (WEF) 52% 50% 33% 33% 33% 33% 27% 20% 20% 20% 20% • GDP growth dropped from 7.2% to 3.4% during 16% 0% 0% 0% 0% 0% 0% 0% 0% 0% 2012-14 (WB) 0% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Why is Energy Efficiency Important for Armenia? create conditions for economic growth while improving Energy Efficiency can: the country’s energy security. reduce the energy intensity of the national economic output, improve cost-effectiveness & competitiveness maintain a safe, sustainable and affordable energy supply, while mitigating climate change help meet increasing energy demand, capturing “lost opportunities” for saving energy in new construction Improve the quality of life for the Armenian population, create jobs and help local economy reduces utility bills for all consumer groups reduces use of limited natural resources and pressure on endangered forest resources Under conditions of extreme energy import dependence, energy that Armenia’s citizens, businesses, and infrastructure do not use is the cheapest, cleanest, and most secure energy resource. Quantifying Energy Efficiency for Armenia’s Economy Realizing full economic potential of energy saving, can Economic gain from energy rise Armenia’s domestic energy saving equivalent to 5% of GNP, supply may rise by 50-70% or 80% of state budget deficit (reduced energy imports) 1m3 of imported natural gas costs twice more than investments to Building 1kW new capacity costs reduce 1m3 natural gas 5 times more than saving 1kW consumption energy on demand side 5 NEEAP Process Introduction • NEEAPs in Southeast European Countries (West Balkans, Moldova, Ukraine, pending Georgia) • focus on documenting ongoing efforts, • identify cost-effective and/or low-cost/no-cost measures to promote energy efficiency, • under conditions of limited availability of funds from state budget, rely on IFI lending and private sector participation • 1st National Energy Efficiency Action Plan (NEEAP) • developed in 2010 for 2010-2013, assessed for 2010-2014 • Set energy saving target for 3% by 2013; • 2nd NEEAP • Assesses the 1st NEEAP progress (2010-2014) • Sets forth targets for the next 3-year period (2015-2017) • Sets indicative targets for 2018 and 2020 • Outlines the allocation of institutional roles and monitoring duties nd Analysis and NEEAP also includes The 2 report on the • Primary energy savings (separate implementation section), which will include description of measures and of measures addressing the primary NEEAP must energy saving potential and primary st activities from 1 energy savings targets (in production, NEEAP (2010- transmission and distribution of contain 2014) EEI Measures and energy, i.e. electricity, thermal Holders of activities for energy); this may include gas and separate 2015-2017 with electricity tariff structure activities indicative targets improvement, other DSM measures, for 2018 and 2020 • National target for nearly zero energy buildings – not quantitative; nd 2 NEEAP • Possible improvements of the primary elements and secondary legislation necessary for achieving the energy efficiency Funds required Education and targets; this may include mechanisms for the promotion for energy efficient public implementation activities aimed to procurement, new regulations and of anticipated encourage standards for enforcement of new activities and rational energy energy efficiency technologies, etc., and sources thereof Deadlines for use implementation • Other data as proposed in the of energy template, as well as data that are not required in the template but are efficiency deemed to be necessary and activities important to be included such as the financial aspects and savings. Sectoral Scope Buildings Public sector Industry • Residential: existing building • Public Buildings • Power sector: generation, retrofitting • Services: Municipal Street- transmission, distribution • New construction: lighting, etc. • Heavy industry/large Regulatory framework enterprises • SME Agriculture Mobility (transport) Horizontal measures • Irrigation, • Electric transport, • policy measures (energy audits, SEAPs, public procurement, codes/standards, BATs, etc.), • Aquacultures, • Road infrastructure, • grants/subsidies, • Greenhouses, etc. • Fuel switching, • TA (audit templates, EE calculators, guidebooks, sample RFPs/contracts, • ESCO development) and • information (training, awareness, info. centers). Scope of Assessment EE Policies, International : Assessed and Best Practices 2017 revised targets Programs, EE Improvement Measures Cost-effective 2018 additional report NEEAP 2nd Recommendatio Financing Market solutions ns for Capacity development 2020 Building, Institutional New plans by IFIs Identification of New Initiatives of New Identification Roles and and legislative Implementation initiatives Presentation Assessment of Energy Saving Impact by Impact Saving of Energy Assessment Assessment of 1st NEEAP impact by 2014 by impact NEEAP of 1st Assessment material Review of Policies, Strategies, Regulations in EE • Energy Sector Development Strategy of 2005 • Law on Energy Saving and Renewable Energy Energy policies • National Program on Renewable Energy and Energy Efficiency and instruments • 1st National Energy Efficiency Action Plan and their • 2012-2025 Long-Term Strategic Development Program implementation • National Energy Security Concept • Least Cost Generation Plan • RE Roadmap & SREP Investment Plan 2014 Secondary • Resolution 1504 on Mandatory EE In State Investment Programs Legislation & • Draft Technical Regulation on “Buildings and structures/premises, construction materials and products. Safety” Regulatory • Draft Technical Regulation on “Building Energy Efficiency” Framework • Normative-technical documentation • Energy Charter Treaty International • Observer Status in Energy Community • United Nations Framework Convention on Climate Change Treaties • EU Covenant of Mayors • Eurasian Economic Union documentation Assessed IFI & Donor activities in Energy Efficiency United Nations Development Program (UNDP) / Global Environment World Bank/GEF Facility (GEF): •Public/Municipal/Social Building Energy Efficiency Credit Line Via ESA Scheme •Green Urban Lighting Project •Improvement of EE in buildings Project •EE in Municipal Heating and Hot Water Supply Project International Finance Corporation (IFC) •Sustainable Energy Finance Project on-lending through banks for corporate and residential United States Agency for International Development (USAID): EE through 2 PFIs •Residential Energy Efficiency for Low-Income Households (REELIH) Program European Bank for Reconstruction and Development (EBRD): •Energy & Water Program, •LEDS Project and least cost generation planning •Caucasus Sustainable Energy Financing Facility in Armenia providing corporate & residential •STIP initiative and plans for water and energy efficiency solutions in fisheries energy efficiency loans through 5 PFIs with free TA & LEMA, and 10-15% grant investment incentives •Direct loans with sovereign guarantees Eastern European Energy Efficiency and Environment Partnership •Leveraged funding from EIB (E5P) KfW lending activities and planned initiatives in the field of energy •Pipeline of municipal infrastructure EE projects: efficiency: •1.District Heating; •2. Water and Wastewater; •EE-integrated reinforcement of schools (may leverage ADB) •3. Solid Waste Management; •Financing solar water heaters •4. Street Lighting; •Housing EE (conceptualizing) •5. Insulation of public buildings or residential housing; •EE in SMEs •6. Urban Transport. Green for Growth Fund European Commission •EE & RE Loans through PFIs •SUDEP EE & RE for Spitak & Vayq Communities •INOGATE Technical Secretariat French Development Agency •NIF grant co-financing for selected IFI loan products •Residential EE Loans to low-to-middle income HH with 5-10% grant incentive through NMC Operated data • IFI survey up to 2014, no projection for future • Energy Balance for 2010-2012, which contradicts PSRC and customs data • Data provided by Municipality of Yerevan on transportation • National Statistical Reporting 200 Background Conditions 150 100 50 0 1992 1999 2006 2013 Year GDP, PPP (Index, base year=1990) Energy use (Index, base year=1990) Economic Growth and Energy Use in Armenia.
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