My Tip for Trevor

[duncan drennan]

Here is my Tip for Trevor which I submitted via the treasury's website.
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Dear Mr. Manuel,

I would like to suggest a possible short term solution to the energy crisis that South Africa is currently facing.

I believe that the demand being placed on our energy supply can be greatly alleviated by encouraging the use of energy savings devices. The are plenty of these, but I believe the one technology that can have the greatest effect is the compact fluorescent lamp (CFL).

An incandescent light bulb (the typical globe with a filament) consumes around 5 times as much power as a CFL to provide the same amount of light.

Currently the incandescent bulbs are MUCH cheaper than CFLs. Interestingly CFLs are about 5x more expensive than normal incandescent bulbs, which means that people focussed purely on direct cost are biased towards replacing bulbs with incandescents instead of CFLs.

The lifetime of a CFL is 6000hrs versus 750hrs for an incandescent - that means 8 incandescent bulbs for every one CFL. Even with RSA's cheap electricity a CFL "pays" for itself in electricity savings in the first year of use.

Census 2001 says that there are 7 815 270 households that use electricity as there main source of lighting. If each of those households were to change 1 single 60W incandescent bulb to an 11 watt CFL (which provides equivalent light) then the energy saving would be of at least 1.5GWh (gigawatt hours) PER DAY. (calculated as, (60-11) * housholds * 4, which makes the assumption that the light is on for 4 hours of the day).

Other than reducing carbon emissions drastically this would also hopefully help to reduce the load on Eskom's power grid. Obviously as business also would have an incentive to apply energy saving techniques there would be even greater savings, and reduction in peak load.

I would like to see energy efficient lighting (like CFLs) subsidised to make it more accessible to everyone, and energy inefficient lighting (like incandescent bulbs) taxed. The tax can go towards the efficient lighting subsidy, and also towards researching and implementing other energy savings products.

With the lifetime of incandescent bulbs being approximately 6 months (750hrs at 4hrs a day), the impact of such a change would take effect relatively quickly (compared to building more infrastructure).

I hope that this idea, whether it is valid or not, has at least stimulated some thoughts on some of the easy ways that we could go about reducing the energy crisis in the interim while infrastructure is provided for new growth.

Thank you for contribution to our country through your financial guidance and wisdom.

Kind regards,
Duncan Drennan (electronic engineer and business owner)

[Dave A]

Incandescent bulb tax (IBT) . Add it to the sin taxes. Pretty good thought there, Mr. Drennan. I am truly impressed.

[Dave A]

It's budget day. We can only wait with bated breath to see of Duncan's IBT proposal makes it.

I quite enjoyed this piece on Trevor's dilemma:

Finance Minister Trevor Manuel is like a father whose corner shop has made an extra profit, but his children are compulsive shoppers and his wife is incapable of buying household necessities.

He is also under the scrutiny of community leaders pressuring him to spend more on the homeless.

The little extra cash comes from the R10-billion revenue collected by the taxman the previous year, and the fact that Manuel has reduced debt by almost half in eight years.

But the the unions and civil society movements claim that because Manuel comes from a poor area, he must spend this on poverty and creating jobs.

As he opens his Budget speech on Wednesday in parliament, Manuel will face the dilemma of whether to give his children, the South African consumers, spending money through tax cuts or allow his wife - government departments and provinces - to buy groceries by delivering services.
full article at IOL here

[Dave A]

I see the news is full of Budget related stories. And now we have the post- Budget breakfast live on TV.

This is certainly turning into an annual event. We're a short step away from an annual convention, complete with trade show.

[Debbiedle]

Trevor has really brought finance to the man in the street! I think he is a brilliant finance minister and has certainly had a huge impact on the successes we have shown over the last few years!

May there be many more ministers like him!! Thumbs up to Trevor!

[Dave A]

I agree with Debbie. Trevor probably has been the Minister of the Year for quite a while. Watching him this morning though, I couldn't help wondering what he was thinking about the glitsy gala breakfast event. Maybe it was still a bit early in the morning.

I've been scouting around for the best place on the web so far to get an idea of what was in the Budget and what it means for us.

Fin24 have set up a Budget area here which seems to be really good. It also comes with a handy tax calculator to see how much of Trevor's tax relief you're going to get.

It looks like I get a bit over R4k in personal relief. Woot.
Now in true South African fashion, I need to think how I'm going to spend my windfall. Maybe a car...

[duncan drennan]

I see this has finally made it to front page news

South Africa finds itself out of step with major countries -- including China -- internationally that are banning the energy-sucking light bulb in a bid to promote energy efficiency.

Although the energy-inefficient incandescent light bulb adds at least 10% to our annual energy bills, about R2,8-billion a year, South Africa charges a 15% import tariff on energy-efficient CFL (compact flourescent lamp) light bulbs, even though we do not manufacture incandescent light bulbs locally.

Banning the bulb could reduce South Africa’s energy requirements by 800MW at a time when the country is running on low reserves of power, facing sharp cost increases and likely to face power shortages until at least 2010. The capital cost of producing 800MW of energy is about R5,6-billion, says Eskom’s Andrew Etzinger.
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But the department of minerals and energy says that there are no plans at policy or legislative level to ban old bulbs and encourage the conversion to CFLs.

Read the full story on M&G Online

There is also an interesting part about Phillips plans to build a CFL plant in the SADC region, and I especially liked this quote,

“Government should introduce a surcharge on incandescent lamps and remove duties from compact fluorescent lamps to bring prices closer together,� Boyle says.

[Dave A]

You've got to be feeling quite good, Duncan.

Nothing like being ahead of the times.

[Chatmaster]

With the current power cuts (load shedding) going on I noticed that my neighbour's outside lights stayed on. He is using solar powered lights on the outside and it is working stunningly well. I think that can in itself be a terrific idea for all municipal street lights and something else that Trevor can look at...

[duncan drennan]

Cape Town recently installed the country's first set of solar powered street lights, so at least if the power is off, those will be on. My experience of Joburg is that there are far more traffic light issues - I wonder when they will be seeing some solar traffic lights?