New rules to cut firms’ power use

The government will compel local industries to consume less electricity to reduce waste while increasing energy efficiency.

In new proposals, the Energy and Petroleum Regulatory Authority (Epra) will require companies to put in place energy saving mechanisms and will penalise them if they fail to stick to the measures.

The draft regulations on energy management say the regulator will set power consumption benchmarks that companies have to adhere to, depending on the sectors they operate and their size. 

Improve efficiency

Epra said in a statement yesterday that the objective of the regulations is to improve energy efficiency and conservation among industrial, commercial and institutional facilities.

While the proposed regulations are in line with efforts put in place to lower the impact of climate change, they might come at a heavy cost for local industries as well as power industry players.

The move could see manufacturers and other big power consumers forced to invest in more energy efficient equipment and possibly alternative power production systems such as solar so as to reduce electricity consumed from the grid.

It could also affect investors in the power production and distribution chain, who could suffer stagnation or slow growth in revenues as the power saving mechanisms bear fruit.

The energy sector relies heavily on industrial customers, who despite being a handful account for about half of its revenues.

In the draft, Epra will classify companies as high, medium and low energy users.

It will also publish energy consumption benchmarks and performance indicators for different sectors within three years of the regulations coming to force.

It is against this benchmarks that companies’ power consumption and saving mechanisms will be judged.

“Where the authority is of the view that any designated facility is consuming unacceptable levels of energy and above the benchmarks established under (the regulations), such facility shall (be required to) submit; detailed energy audit report compiled by an accredited energy auditor and detailed remedial plan of action to reduce energy consumption to acceptable levels,” read the regulations, which are currently being subjected to public participation.

Failure to submit a detailed energy audit report, a detailed remedial plan and the failure to implement such a plan on approval by the authority shall be an offence, the regulations say.