Energy Analyst David Lipschitz Interviewed on CNBC Africa - by phone - Open Exchange Program - Interviewed by Tumisho Grater

The points I spoke about are:

1) NERSA: the price increase is not off, just delayed. (NERSA said "Eskom's documentation is not in order." I think Eskom will try for an increase in January so that municipalities can get ready.)

2) Government doesn't want to fund Eskom anymore. Eskom's financing status at "Junk" which means that debt financing is very expensive.

Normal financing isn't working anymore. We need to think differently.


3) Use Time of Use Tariffs for everyone in South Africa. Then people can choose what they want to pay, eg 50 cents per kWh between 10pm and 6am; R2 from 6am to 10pm and R4 at peak time (7 to 10am and 6 to 8pm).


4) Use Demand Response for everyone in South Africa. Then Eskom can do "load shedding" and switch off non-essential loads in peoples houses.


What I didn't mention is that Net Metering should also be implemented without a service fee. This will incentivise people to make electricity and especially to sell it at peak time. Sales can be at 40 cents per kWh, R1.60 per kWh and R3.20 per kWh and Eskom can pocket the difference between their buying and selling price.

Do you want to be rich? I want to be rich!

Continuing my theme of trust and working together

The main reason the rich are rich is because they socialise!

The poor socialists have forgotten that socialising is the most critical way of generating wealth, ie by doing business with each other rather than with outsiders.

If the poor and middle class want to be wealthy we need to keep the money inside our communities and stop it from leaking out.

Jeremy Rifkin on Social Capital and Trust

Jeremy Rifkin talking about social capital and trust. A clip from a much longer recording he made at the CEBIT IT conference in Hanover, Germany, in March 2015.



I believe that Trust is the single biggest problem facing South Africa. As soon as we start trusting each other, change will happen.



I believe that the reason that big businesses like Microsoft, Facebook, Google, Apple, Liberty, SAB, and so many others got big and great is because the founders stayed together and worked through their problems and didn't steal from each other. They looked and look to the long term value they can give to their clients and therefore they got rewarded for their vision. But number 1: they trusted each other and they stayed together.



This clip is part of a much longer 1 hour 23 minute talk which you should watch in total: https://youtu.be/75yiRvi48RQ



Jeremy Rifkin supports my view, which you can also see here: https://youtu.be/I7W6kn9M8pI

TOU and DR for homeowners!!

It's time for Time of Use Tariffs and Demand Response for Homeowners.

Let homeowners decide for themselves if they want to pay more for electricity at peak times and or have load shedding or part load shedding.

And please don't let Eskom say its impossible. I lived in the UK from 1987 till 1995 and we already had Time of Use Tariffs in the UK back then on meters where we paid our accounts in arrears.

http://www.engineeringnews.co.za/article/eskoms-molefe-comes-out-swinging-on-final-day-of-nersa-hearings-2015-06-24/rep_id:3182

Oh, and its about time that homeowners understand these abbreviations:

• TOU: Time of Use Tariffs: paying different rates for electricity at different times of the day
• DR: Demand Response: switching off particular circuits such as cooking, geysers, air conditioning, under floor heating, swimming pool pumps, etc, which don't affect all the things we need to keep running in our houses. And if you are cooking a cake and you don't want the oven to switch off, you press a button and the oven stays on and you just pay a higher rate until your cake is cooked.

CNBC Interview on 23rd June 2015: David Lipschitz in the news

"National Energy Regulator of South Africa (Nersa) begins its public hearings into Eskom's 25.3 per cent tariff increase application for the 2015-16 financial year. To discuss this CNBC Africa is joined by David Lipschitz, energy analyst at My Power Station: Software, Energy, Power."

And the video is here. I was interviewed on CNBC Africa's Open Exchange Program, by Tumisho Grater.

And CNBC's article is here.

On Facebook. On Twitter. On Google+.

And on CNBC Africa's daily news feed here. Click on:

"ESKOM PLEADS FOR TARIFF HIKE, BIG BUSINESS WARNS OF JOB LOSSES"

CNBC Africa Interview on 23rd June 2015

Dear all

I, David Lipschitz, will be interviewed on live TV tomorrow morning at 9.20am, so if you have time watch CNBC Africa on DSTV Channel 410 and maybe you'll see me.

I'll be in their Cape Town studios and they'll interview me from their Joburg studios.

It'll be the first time I am being interviewed on live TV.

Here is their email to me:

Thank you once again for agreeing to be on our show. As per our telephone conversation, your interview will be at 09h20 and it will be centred around the proposed tariff hikes by Eskom. Will this assist the indebted power utility? What will some of the implications to the consumer be if the hikes are implemented? Our presenter, Tumisho Grater will give you a ring in the morning to talk more about the points that she would like to address during the interview.

Details:

Show: Open Exchange 08h45-10h00

Presenters: Tumisho Grater

Channel: CNBC Africa, DStv 410

Interview duration: +/-8 minutes @ 09h20

Regards

David

Are all Eskom customers the same?

So I heard on the radio today that Eskom have asked NERSA to approve a tariff increase for more money to pay for Diesel so that we can all avoid load shedding!!

This is an unfair monopoly position. Why should all of Eskom's customers be treated the same way?

Perhaps some customers are prepared to have load shedding in place of a price increase?

Should South Africa really have 426 GW of electricity?

426 GW?

33.6GW?

South Africa has about 42 GW of electricity on the grid, but as we all know Eskom can only provide about 75% to 80% of this on a regular basis, so lets say 33.6 GW is available. Eskom and the government say that South Africa's demand is decreasing, but if someone put up your prices from 57 cents per kWh to R1.96 per kWh between 2008 and 2015, you would probably also try to find ways of reducing your consumption! Or perhaps using other cheaper sources of electricity?

With inflation at 5% over this time, prices should be 80 cents per kWh, not R1.96 per kWh. Note that the R1.96 per kWh is the price in the City of Cape Town for a homeowner using 1,200 kWh per month. Prices include VAT.

Worldwide electricity growth is 4% per annum, so over 20 years, 42 GW should have become 84 GW.

But in South Africa, our government has a policy of ensuring that everyone has access to electricity. So if you take someone with no electricity and you give them, or they buy, a kettle and a washing machine and an iron and a hob and an oven and a vacuum cleaner then electricity growth is closer to 6% (or more) and electricity availability should already be closer to 142 GW.

Now the average American uses 3 times as much electricity as the average South African, so this 142 GW should be 426 GW.

Even if I'm a little bit wrong and our inherent demand is actually 100 GW, there is no way that Eskom can ever keep up with build and supply, even if they do their R2,300,000,000,000 (R2.3 trillion) build. And as we know Eskom are always at least 100% over budget and at least 100% behind on time when they build or fix power stations, so we can work on never having the kind of electrical resources we should have.

So why not turn Eskom in the Independent Market System Operator (ISMO), allowing it to continue running its power stations and allowing everyone to become a PROSUMER, someone who produces and consumes electricity and people who can export electricity into the grid when the electricity is needed. In fact private people can buy and sell electricity from and to each other across a nationally owned electricity grid.

(For more about Prosumers and what will happen in our 21st Century economy, read The Zero Marginal Cost Society by Jeremy Rifkin: http://www.thezeromarginalcostsociety.com/)

(The South African government started discussing the ISMO bill back in 1998 when the government created the Energy White Paper of 1998).

(Grids: planes fly across countries using the airway grids; private trains use nationally owned railways in the UK and Europe; cell phone operators use fixed cable grids owned by other multinationals and governments; in Germany, one can buy and sell electricity across the national electricity grid).

For this to happen though, we need 1 million people to support this notion. I thought that if I created a petition, it would help, but it hasn't helped. Sign it now: https://secure.avaaz.org/en/petition/South_African_Government_Level_the_Playing_fields_in_the_Electricity_Industry/?miJGmbb Please.

And there are 600 million people in Africa without electricity. Can you see the potential of finding a sustainable electricity source that doesn't effect the environment?

So what to do? A few years ago I decided that instead of focussing on installations where I could influence 100 people a year, that I would do public speaking where I can influence 100 people at a time, and so that is what I am doing. If you need my help to speak to your company, your community, your board of directors, or to you and your friends, please let me know.

The solutions are at hand. The money is available. The technology is available and a lot cheaper than it was 10 years ago.

IT'S A SOCIAL PROBLEM. We believe that we are free if we are separate, but we are free if we are together, yet with independent thinking and free speech. If only we would work together to solve our really big problems. We have lots of sociologists in South Africa and they need to come to the party.

Looking forward to hearing from you and to creating the kind of environment we can, where everyone has a job and everyone has holidays and everyone is safe and everyone is saved.

PS: Where is the missing 392 GW? (426 - 33.8)

South Africa exports its coal, bauxite, iron ore, gold, platinum, uranium, diamonds, chromium, etc, and other countries use these resources to make electricity and goods, which we then import.

Everything, including the jobs and most of the profits, happens overseas using our resources. And we export things for a pittance and then import them expensively. So our balance of payments is poor and our exchange rate is terrible, when we should actually have one of the strongest exchange rates in the world.

An energy resource: https://en.wikipedia.org/wiki/World_energy_consumption

Buckets of Sun - a short story about energy for schools and learners and adults

Some weekend reading: enjoy:

Buckets of Sun

By David Lipschitz and Dorian Haarhoff, © May 2012


Once there was an island just off the coast of South Africa not far from Robben Island. It was roughly the same size. The place had no name. There were 50 houses on it. The houses had no names either.

Power came from the mainland. Islanders referred to this as The Mains. Once a month a man called Bill came from the Mains dressed in a coal black suit. He knocked on every door to collect the monthly electricity and water money.

People grumbled. Mr Expense from no 6 peered at Bill through his glasses with fossil frames (everyone on the island wore them) “this month we’ve even stopped bathing. We only take showers. But the bill goes up.”

Bill shrugged his shoulders “You ain’t seen nothing yet” he muttered as he dropped three of Mr Expense’s R500 notes – yes, the Reserve Bank now issued R500 notes - into his collection box. The residents grumbled but did nothing.

Then one morning life changed for the islanders. It happened to be a holiday - Freedom Day 27 April. The sun was shining brightly as it did most days in this part of the world.

It was Suna from no 13 - the 13 year old, who came running with the news. She panted “There is a man with fiery red hair standing on the beach. He’s wearing green goggles. He has a sunflower in his hat. He is surrounded by buckets. Lots of buckets. You have to come and see.” She ran from door to door. Her dog, Sunbeam, ran with her. She called him Sunbeam for his coat was golden.

Somebody from each house made their way onto the beach. Sure enough there was a man in green goggles standing surrounded by 50 buckets. Each bucket had the number of one of the houses on it. “Come and get your bucket of Sun” he called.

Sunbeam ran up to the man and wagged its tail.

“Who are you?” a few of the women asked.

“You can call me a Sungoma” the man smiled “and I come from up there.” He pointed towards the sun.

Suna cried out “I wrote a poem about the sun’s smile.” She recited it by heart.

“The Sun god beams and smiles
then shakes his fiery hair.
Here’s energy for Africa
as I’ve got light to spare.”

“Ah yes. well done. That’s the generous old sun for you.”  Sungoma clapped his hands.

“What is this all about?” muttered Mr Slowchange from number 27 suspiciously.

“It’s simple,” said the Sungoma.  “You take the bucket of sun and you pour it onto your roof into a special contraption. And now you have sun power for as long as your house stands.”

“How much does it cost?” grumbled Mrs TightBudget from no 33.

“Costs the same as you pay to Bill from the Mains every month.”

“So why change?”

“Ah the difference is the this cost doesn’t go up and up every month like a helicopter. It stays the same.” Sungoma held up five green fingers and ticked them off one by one.  “One we produce electricity. Two we save electricity. Three we save water. Four we save money. Five we save the planet.”

“So,” said Grandpa Thinka,  “We are simply being more efficient?  We work with nature rather than against nature?”

Sungoma did a dance. “You’ve got it you’ve got it”, he sang.

Addem, the accountant, spoke up. “I’ve worked it out. Energy Efficiency is the first step. We call that efficiency Negawatts. Once we've done this, we make electricity for the balance of our electricity needs.”

“Sungoma slapped him on the shoulder “Yes, yes.”

Grandpa Thinka then asked, “So how do we save? We have to install some saving things right?”

“If all 50 get a sun bucket, I can buy what we need at a rock bottom prices … and wait for it ….the price is thrown in to the monthly cost. And you could all get a tank.”

“What kind of tank?” asked Colonel Fighta, thinking of his army days.

“He means a water tank, Uncle”, explained Suna.

At that point Sungoma handed everybody a pair of green goggles. “Here, take off your old specs. Put these on.” The islanders put them on and suddenly the world looked different. It was full of possibility. “When you wear these”, explained Sungoma, “all the plugs and appliances in your home that chew electricity and gulp water will show up as luminous green.”

“What’s the catch?”, shouted Sir Spicious.

One of the residents, Mrs Ena Sight, suddenly saw the light. “The only catch is if you keep paying coal man Bill more and more every month. Water goes up and up like a fountain except it never comes down. Give me a bucket.”

The couple at no 3 squeezed each other’s hands. They had not done that for years. “We’re signing up too.” They had a mielie farm.

Old Mrs Smiley, Suna’s grandmother began to sing happily “You are my sunshine my only sunshine.”

Sir Spicious asked “Can we trust this man?”

Just then Suna’s dog, Sunbeam, went up to the Sungoma and licked his hand. Sunbeam then rolled over and exposed his belly to the sun’s rays.

“I trust Mr Sungoma”, announced Suna.” Her granny nodded  “Children and dogs know things.”

Another resident wanted to know, “How will we organise this? I worked for the Mooncipality and that was chaos.”

“We already have a Neighbour Watch. So we organise a small group that looks after our sun interests” smiled Con Nection from no 41.

“We can call it the Neighbour Watts” yelled Suna. Sunbeam wagged his tail.

So the people took a bucket of sun each. Two neighbours started chatting to each other as they walked away “I have family from the Mains to stay this month. My son and daughter-in-law and their four children. I’m worried I won’t have enough sun power.”

One bright neighbour looked at her through her green goggles “Never mind. I’ll have too much sun this month so you can come with your bucket and borrow some.”

People began to find names for their houses. Sundance, Sundeck, Sunergy, Sunchronicity.  When the end of the next month came the people on the Mains grumbled while the green goggled islanders smiled and turned their faces to the sun. After a few months they didn’t need goggles at all so they took them off. Their eyes had adjusted to the green light and insight.

Tourists came from the Mains to see why the islanders looked so happy and had money for holidays. Suna was their tour guide “Now instead of sums we do suns” Suna explained, “and you can create your own sun island just like ours. Just ask Sungoma to bring his buckets. ”

The community met and elected their Neighbour Watts. They named their island Madebasun and they saved happily ever after.

What we didn't learn from Curitiba

Eskom's workers help push rand to new low

Our erstwhile politicians and Eskom's workers are pushing the Rand to new lows. Official unemployment is at 37.8%, our worst ever.

And the 2 million unemployed people who could have work if only Medupi and Kusile Coal Power Stations were online, like they should be, don't realise that they need to go to Lephalale (Ellisras) and tell Eskom's workers to do their jobs!

Oil price has increased from R743.38 per barrel on 30th May to R806.98 today. 8.5% higher.

Rand at 12.44 to the $
13.99 to the Euro
19.04 to the Pound

$ is high against Euro at 1.12, but it has been as low as 1.4, which would make the Rand Euro 17.42!!!

Professional Speakers Association of South Africa

Load Shedding Talk

Tonight I did a talk at the PSASA: Professional Speakers Association of South Africa.

There were about 22 people there, including people who came from as far as Somerset West. Not sure if they came specifically to hear me as there was also an international speaker on Skype and a "5 minute speaker."

I was given 40 minutes; good practice.

My third talk on "Load Shedding, Why it Happens and What we can do about it" since 27th July (less than two weeks ago).

I am enjoying all this publicity, and more importantly getting through to people about this particular subject. Let's get it higher on our radars and each of us doing our bit to not only be energy efficient, but also to make the electricity our national grid so sorely needs.

If you'd like a talk on Load Shedding, or Net Metering, or Grid Tie, or Feed In Tariffs, or IPPs, or Energy Efficiency, or Demand Response, or Retail Wheeling, or Why do we need electricity anyway? or Why are we in this mess? or Fracking, or Living Off Grid, or How to retire without retirement funding, then give me a call.

Why electricity deregulation in South Africa will dramatically increase Eskom's size?

We are told that Eskom have 80% of what they need and should have 115%? What does it mean?

Eskom theoretically have 42 GW of base load.

But they can usually only supply 33.6 GW (80% of 42GW), and sometimes (during load shedding) as little as 28 GW.

But for us to have a proper grid according to international best practice, in order to supply 42 GW of base load we should have 48.3 GW (115% of 42GW). This allows for planned maintenance, unexpected shutdowns, etc.

Of-course all this assumes no growth in electricity over the past 20 years, as we have had hardly any new additional power stations coming on steam. For comparison, China adds 1 GW a week.

Worldwide electricity growth is 4% per annum which means 100% growth over 20 years, so Eskom should be able to provide 84 GW of electricity. Of-course this would double their income, but the government hasn't noticed this! And it would more than double the size of the economy due to new energy efficient industries coming on stream; and therefore taxation would dramatically increase and joblessness would dramatically decrease, but government hasn't noticed this either!

Furthermore, Eskom specialises in bringing people out of poverty and connecting them to the grid. This means that people suddenly have dish washers, washing machines, microwaves, kettles, hairdryers, heaters, stoves, hobs, etc, and therefore electricity growth in South Africa is much higher than 4%. And worse than this, because the people are poor, they get free electricity, which is paid for by people with jobs.

In South Africa, my definition of a rich person is someone who pays tax. A poor person receives handouts. Furthermore, a rich person tends to have a job. Whilst a poor person doesn't. This is a very sad state of affairs, and it doesn't need to be like this in South Africa.

In my opinion, Eskom should be able to supply over 100 GW by now.

But it can't. So what happens? Perhaps I am cynical, but this is what I see. We switch off industries and create unemployment. First to go? Textiles. Next? Smelters. Next? You?

If we mine something and then we smelt it, then we will be able to do the next steps and bring the final product to market. If we send coal and gold and uranium and platinum and bauxite and iron ore, etc, overseas, then China, South Korea, Australia, Germany, Israel, and others, use our coal to make electricity and to turn our minerals into aluminium, steel, etc, and they make cars, cell phones, computers, etc, which we then import.

Our mined products are overseas. Our jobs are overseas. Our taxation income is overseas.

Our balance of payments is hurt because we export raw materials at R1 for example and buy it back for R50. The profits are also overseas. We have high inflation and we have a poor exchange rate. Our people get poorer, even though the world's raw materials are in Africa.

So how does the government solve this problem? They get a R30 billion loan from the Chinese Development Bank for new locomotives for our railways. So what happens? We export even more raw materials, and China, and other countries gets richer at our expense, whereas if we had electricity, we could get richer together.

Eskom, and the government and the DA are so fixated on the tiny amount of income they can get from electricity sales that they have forgotten what electricity is for. In the 21st Century, with the talent we have in South Africa, we can grow our economy sustainably and dramatically, providing finished goods and services to Africa and the world. But our labour laws, and the red tape required in running a business, both support big business and reduce entrepreneurship at the same time. Big business can afford the people needed to deal with red tape. Hence draconian labour laws and draconian legal requirements for business hurts small business a lot more than it hurts big business.

If Eskom and the Cities deregulated electricity supply and allowed a free for all, there is no way that anyone could keep up with the supply that would be required to keep South Africa going. Eskom can't keep up.

An American uses almost 3 times as much electricity as a South African, so if South Africans want to be like Americans, we should have 300 GW of electricity on our grid, and we have about 30 GW of always available electricity.

In my opinion, Eskom should become the ISMO, the Independent System Market Operator, owning the national electricity grid and allowing people to buy and sell from each other. Eskom can continue to own and manage its own power stations, but with a 300 GW latent demand in South Africa, Eskom with its 42 GW of theoretical capacity cannot and will never keep up with demand required.

The Energy White Paper of 1998 and the Renewable Energy White Paper of 2003 should immediately by implemented. Net Metering with Time of Use Tariffs should immediately be allowed for everyone. Demand Response, where Eskom pays users to be switched off, should immediately be extended to private homeowners and SMME's. Homeowners should be able to build their power stations with before tax money just like big business and IPPs (Independent Power Producers) can, ie homeowners should be able to buy their energy efficiency products, and inverters, solar panels, batteries, etc, before tax and before VAT. And homeowners should be given the same kind of contracts that IPP's have so that the electricity build in South Africa can be further speeded up.

The government thinks they will lose money by doing this, but imagine a South African economy which is 10 times bigger than it is now. The government would collect 10 times as much tax revenue, ie R10 trillion per annum instead of R1 trillion per annum. Imagine how many private jets that could buy, not just for government ministers, but the thousands of new billionaires and millions of new millionaires that would be created in this vibrant land of ours. Imagine the social good that could be done with R10 trillion per annum? Every school that is needed created. Every hospital created. Free schooling, university education and medicine for everyone.

An eradication of poverty.

BBC Africa Debate on BBC World tonight (5th June 2015) at 7pm GMT, 9pm South African Time.

Breaking News Involving David Lipschitz

Listen to the radio at 7pm GMT tonight if you can.

I was invited to attend a #bbcafricadebate debate on Africa's energy future with the BBC.

It is called the BBC World Service Africa Debate.

It was excellent and an opportunity to hear decision makers make speeches and answer questions and I had a wonderful discussion with Alderman Ian Neilson, the Executive Deputy Mayor of the great City of Cape Town, and he is also in charge of Finance.

He said I am antagonistic, and I said that the reason I am antagonistic is because I don't get replies when I write to him and others.

The only way I get replies is if I write to newspapers and magazines and ask questions on radio and if I meet people like Ian in person. He responded very well to my questions, and to a BBC reporter's questions and my hopes that ALL energy options are being looked at by the City of Cape Town have been raised.

Thanks to Mary Morgan and her team at the BBC for organising the debate and for inviting me and many other IAPs (interested and affected parties).

Load Shedding talk to the Jewish Seniors

I did a talk on Load Shedding at the Jewish Seniors this morning.

They called me yesterday afternoon at short notice and told me their speaker couldn't make it and they asked if I would do a presentation. I changed my arrangements and did my Load Shedding presentation.

Their projector stopped working, so I went to plan B which is my presentation using 3 posters, which also allows me to talk on Feed In Tariffs, Grid Tie, Batteries, Grid Parity, etc.

It worked well.

Here is their social worker's email to me:

"What can I say, you were an amazing success and a hit with the seniors. They loved you and found your talk extremely interesting.

"Thank you for you willingness to come at such short notice, for your support and adaptability.

"I hope we can book you again soon for another talk."

#loadshedding

#load_shedding

Load Shedding and What we Can Do About It?

#LoadShedding till 2023?

If you'd like a talk and discussion to your company or community on Load Shedding and what we can do about it, please let David know.

#WEFAfrica15 #WEF happening in Cape Town this week.