The Department of Energy (DoE) has launched its ‘market sounding exercise' to assess the solar water heating (SWH) appetite in various geographical areas of South Africa.

"This market sounding exercise is meant to ascertain the market capacity, capability, as well as the level of interest before the actual roll-out of the SWH systems," said DoE director general Nelisiwe Magubane.

Some of the services that the DoE would be looking for included: the provision of SWH systems; the installation and maintenance of SWH systems; the independent measurement and verification of achieved savings.

Interested parties could contact the department through its website.

The department has committed to the roll-out of one-million SWH systems by 2014, in an attempt to reduce the use of coal-fired power to increase energy security, as well as for environmental reasons, and also as a way of alleviating poverty and improving service delivery.

The department aimed at incentivising the roll-out of 200 000 SWHs in the current financial year, through its standard offer programme (SOP). Under this SOP, a price would be offered for every kWh of electricity saved, as well as the savings per SWH system (for example, 200 kWh/SWH system/month) - and this money would be paid back to the SWH installer over time.

Thus an installer would install the system for a customer, and get money back through the SOP only after the savings were achieved.

The price per kWh was yet to be determined by the National Energy Regulator of South Africa (Nersa), however, what was certain was that it would be funded through electricity tariffs, and it would be reviewed every year. Currently, the suggested rebate for 2010 was 54c/kWh.

On August 5, public hearings into the Standard Offer Policy and regulations would be held at Nersa. A final pronouncement on the rules of the SOP would be made on September 23.

Nersa published a consultation paper on the SOP in June, wherein it invited written comments from the public.

"The information obtained through the Nersa process will help us to better understand the market before ultimately determining the way forward. Views and suggestions that will be solicited from this exercise will not be disclosed to third parties or used for any other purpose," Magubane said.

She further explained that the standard offer concept was premised on providing financial incentives for the energy savings that were derived from this SWH initiative.

"This will be the case irrespective of the technology that has been applied to achieve these projected savings. This is an intervention that is outcomes based. It is anticipated that the incentives will be offered only after the delivery of the outcome, and the subsequent process of verifying energy that has been saved", she said.