System Dynamics Simulation of Income Distribution and Electric Vehicle Diffusion for 25 JulyElectricity 2016 Planning in South Africa By Nalini Sooknanan Pillay Dissertation presented for the degree of Doctor of Philosophy in the Department of Industrial Engineering at Stellenbosch University Supervisor: Prof AC Brent Co-supervisor: Prof JK Musango Co-supervisor: Prof SS Grobbelaar December 2018 Stellenbosch University https://scholar.sun.ac.za Declaration By submitting this dissertation electronically, I declare that the entirety of the work contained therein is my own, original work, that I am the sole author thereof (save to the extent explicitly otherwise stated); that reproduction and publication thereof by Stellenbosch University will not infringe any third party rights; and that I have not previously, in its entirety or in part, submitted it for obtaining any qualification. Date: December 2018 Copyright © 2018 Stellenbosch University All rights reserved 2 Stellenbosch University https://scholar.sun.ac.za Abstract The electricity generation industry has developed a symbiotic interdependence with the social, environmental, economic and political ecologies in the country, resulting in divergent complexities, which require non-linear model-based planning methodologies. Some of the determinants influencing the power industry include technologies, such as battery electric vehicles (BEVs), which have gained prominence as a possible option to support South Africa’s climate change commitments. This study used an adapted system dynamics modelling process to determine the provincial affordability of BEVs in South Africa so that amended regional forecasts of BEVs could be established to plan for charging infrastructure, environmental impacts in the energy and transport sectors, as well as changes in electricity consumption. Results from the Electricity Strategic Battery Electric Vehicle (E-StratBEV) simulator indicate that aligning BEV market penetration with the current consumer behaviour within deciles on vehicle expenditure, results in significantly lower than the expected market penetration. This means that by 2040, a low growth GDP-based target of 233,700 BEVs could adjust to 44,155 BEVs, while a high growth scenario of 2,389,950 BEVs (based on South Africa’s commitment in the Paris Agreement) could adjust to 451,736 BEVs. The inclusion of BEV drivers, such as reduced purchase price, increased charging infrastructure, reduced “range anxiety”, and improved reputation effect, add a further cumulative total of 270 GWh from 2019 until 2040 for the low growth scenario, and an additional 2,764 GWh for the high growth scenario, to the residential electricity consumption. From 2019 to 2040, a renewables heavy supply mix results in a 7% cumulative decrease in CO2 emissions in the transport sector; however, with a coal heavy supply mix, no gains in carbon emission reduction is achieved. The adapted system dynamics modelling process allowed for the successful development and implementation of the E-StratBEV, however, the process can be further enhanced by establishing preliminary complexity criteria to ensure a project requires this method before commencement. 3 Stellenbosch University https://scholar.sun.ac.za Acknowledgements This thesis is a culmination of several years of extensive learning, frustrations, introspection and persistence, but ultimately, it has been a truly inspiring and fulfilling experience. I am greatly indebted to my supervisor Professor Alan Brent, who believed in my ability to deliver on an “ambitious” study, and for his continuous support, patience and technical guidance throughout this journey. Sincerest gratitude also goes to my other supervisor, Professor Josephine Musango, for her enthusiasm, immense knowledge and motivation at times when I felt overwhelmed and could easily have surrendered the ultimate challenge of completing my PhD. Thanks to Eskom SOC for funding my studies and providing opportunities for learning and technical engagement. Thanks to the team in the Eskom System Dynamics Centre of Expertise for trusting and believing in my leadership so that we could collectively advance system dynamics modelling and skills in South Africa – efforts which resulted in the adapted process. Specific thanks to Danie Booyens for his continuous support, insightful comments and for being my technical sanity check, throughout the study. I am also grateful for the friends and family in my life that provided moral support and helped me in getting through a very emotional and life changing couple years of my life. 4 Stellenbosch University https://scholar.sun.ac.za Dedication This thesis is dedicated to my three children: Tejal, Anita and Nikhil. I am abundantly blessed to have received your unflinching love, encouragement and tolerance for the countless days I spent away from you while working on my studies. You made me stronger, better and more fulfilled than I have ever been. Your conviction in me kept me grounded while I tried to balance my parenting duties with work and studies, in between life’s vacillations. I could not have made it to the end without you. My message to you is that you can achieve your dreams with passion, hard work and commitment but whatever you do - remember that life is too short to be anything other than happy. No matter how hard life gets at times, always look for that silver lining, because there will always be something to be grateful for. 5 Stellenbosch University https://scholar.sun.ac.za Table of Contents Chapter 1 1.1 Background ........................................................................................................................... 18 1.2 Problem Description .............................................................................................................. 19 1.3 Research Objectives ............................................................................................................. 20 1.4 Justification and Scope of the Research ............................................................................... 21 1.5 Original Research Contribution ............................................................................................. 21 1.6 Research Design ................................................................................................................... 22 1.7 Thesis Structure .................................................................................................................... 24 Chapter 2 2.1 Theoretical Considerations ................................................................................................... 26 2.2 Approach to the Literature Analysis ...................................................................................... 26 2.3 The Energy Sector ................................................................................................................ 27 2.3.1 Electricity Supply and Electricity Consumption in SA ........................................................ 27 2.3.2 Transport Sector in South Africa ........................................................................................ 29 2.3.2.1 Factors Influencing the Demand for Passenger ICEVs .................................................. 29 2.4 Electric Vehicles .................................................................................................................... 31 2.4.1 Brief History of Electric Vehicles including Commercialisation .......................................... 31 2.4.2 Types of Electric Vehicles .................................................................................................. 36 2.4.3 Batteries for Electric Vehicles ............................................................................................ 37 2.4.5 Factors affecting EV Adoption ............................................................................................ 42 2.4.5.1 Subsidies and Other Incentives ...................................................................................... 42 2.4.5.2 Import Taxes ................................................................................................................... 43 2.4.5.4 Charging Infrastructure ................................................................................................... 45 2.4.5.5 Consumer Perception and Consumer Behaviour ........................................................... 45 2.4.6.1 Department of Transport: Green Transport Strategy and the Roads Policy ................... 49 2.4.6.2 UNIDO’s Low Carbon Transport South Africa Project (LCT SA) .................................... 49 2.4.6.3 SANEDI’s Cleaner Mobility Programme ......................................................................... 49 2.4.6.4 The CSIR Energy Fleet ................................................................................................... 49 2.4.6.5 uYilo eMobility Programme ............................................................................................. 50 2.4.6.6 Transport Nationally Appropriate Mitigation Actions (NAMA) project ............................. 50 2.4.6.7 eBike Sharing Schemes (NMMU)) .................................................................................. 51 2.4.6.8 EV Charging infrastructure roll outs ................................................................................ 51 2.4.6.9 EV Public transport developments .................................................................................. 52 2.4.6.10 Eskom eMobility Programme .......................................................................................