1. ENERGY & DEVELOPMENT RESEARCH CENTRE University of Cape Town
Cost-benefit analysis of energy efficient
interventions in low-cost housing
HARALD WINKLER
Lwazikazi Tyani, Randall Spalding-Fecher, Khorommbi Matibe
ENERGY & DEVELOPMENT RESEARCH CENTRE University of Cape Town
May 2001

2. INTRODUCTION
Objective- to analyse the cost-effectiveness of energy efficiency interventions in low-cost housing from national and consumer perspectives
Types of low-cost houses considered were
30m2 RDP house,
row house and
informal house
Types of interventions analysed included:
ceilings, roof and wall insulation
window size, partition
efficient lighting and solar water heating

3. Large benefits for society

4. Benefit per household

5. Not always affordable for poor households
1,000
500 -
Rands
-500
RDP
house
Row
house
CFLs
Shacks
Solar
Water
Heaters
-1,000
-1,500

6. Less than R1000 subsidy is needed

7. Potential financing opportunities
Potential financing from climate change mechanisms
Carbon revenue could be similar size as subsidy requirement
At $10 per ton of carbon, R500 - R1,000 per household over 20 years
Requires costs to develop project
feasibility
monitoring
NOT the only financing option
bilateral funding
multi-lateral development banks
Further study on local financing options (EEU)

8. Conclusion and Recommendations
Analyses presented here indicates that investments in energy efficiency are economical and environmentally attractive at a social level
Capital subsidy required
Interventions with negative costs are “no regret” options
Several other EE interventions have potential as CDM projects
Opportunity for co-funding initial capital cost
Explore funding options