Joint UNDP/World Bank Energy Sector Management Assistance Program Activity Completion Report No. 066/87 Country: KENYA Activity: sot WARA HEATTING STUDY FEBRUARY 1987 Report of the loint UNDP/Vdd Bank Erwgy Sector Management Assistance Program This docunent has a restricted dsbution. Its contents may not be disdosed without Authorization from the Goverment, the UNDP or the World Bank. MMG SECTOR NANIGEHN ASSISTANCE PROGRAM The Joint UNDP/World Bank Energy Sector Management Assistance Program (ESMAP), started in April 1983, assists countries in implementing the main investment and policy recommendations of the Energy Sector Assessment Reports produced under another Joint UNDP/World Rank Program. ESMAP provides staff and consultant assistance in formulating and justifying priority pre-inveGtment and investment projects and in providing management, institutional and policy support. The reports produced under this Program provide governments, donors and potential investors with the iformation needed to speed up project preparation and implementation. ESMAP activities can be classified broadly into three groups: - Energy Assessment Status Reports: these evaluate achieve- ments in the year following issuance of the original assessment report and point out where urgent action is still needed; - Project Formulation and Justification: work designed to accelerate the preparation and implementation of investment projects; and - institutional and Policy Support: this work also frequently leads to the identification of technical assistance packages. The Program aims to supplement, advance and strengthen the impact of bilateral and multilateral resources already available for technical assistance in the energy sector. Funding of the Program The Program is a major international effort and, while the core finance has been provided by the UNDP and the World Bank, important financial contributions to the Program have also been made by a number of bilateral agencies. Countries which have now made or pledged initial contributions to the programs through the UNDP Energy Account, or through other cost-sharing arrangements with UNDP, are the Netherlands, Sweden, Australia, Switzerland, Finland, United Kingdom, Denmark, Norway, and New Zealand. Further Information For further infcrmation on the Program or to obtain copies of completed ESMAP reports, which are listed at the end of this document, please contact: Division for Global and OR Energy Strategy and Interregional Projects Preinvestment Div. II United Nations Development Energy Department Program World Bank One United Nations Plaza 1818 H Street, N.W. Nt. York, N.Y. 10017 Washington, D.C. 20433 * '':. . . ' '.'S'. ...._.'.8.. SOLAR W&TU UIATIUC STUD! fl310U! 1987 CURRENCY EQUIVALENTS Currency Unit Shilling (KSh) Kenya Cents 100 KSh 1 US$1 KSh 16 1/ T/ The June, 1986 exchange rate. ENERGY CONVERSION FACTORS 0h,, cal Units p..r toe a/ Petroleum Products (m3) L.P. Gas 1.85 Gasoi I 1.19 Kerosene 1.25 Fuel Oil 1.06 Electricity (KWh) Thermal equivalent (supply) 4,000 Hiydro (end use) 12,000 Woodfuels (metric tons) Fuelwood (air-dried) 3.95 Charcoal 1.31 -a/ One ton of Oil equivalent (TOE) - 10.2 rillion kcal = 42.7 miIlion kilojoules. ACIOUYMI AND ABBRZVIATIOIS ASHRAE American Society for Heating Refrigeration and Air Conditioning Engineers STU British rhermal Units CAC Collector Area Coefficient deg C Degree Celsius deg K Degree Kelvin ESC Energy Saving Coefficient GJ Gigajoule GOK Government of Kenya GPM U.S. Gallons per Minute GW Gigawatt GWh Gigawatt-hour HFCK Housing Finance Ccmpany of Kenya HP Horsepower IDB Industrial Development Bank IG Imperial Gallon 1.2 U.S. Gallon Kcal Kilocalories KPLC Kenya Power and Lighting Company kWh Kilowatt Hour LPG Liquifi;ed Petroleum Gas LRMC Long run marginal cost m2 Meter m2 Square Meters -m3 cubic meters MOERD Ministry of Energy and Regional Development MOI Ministry of Industries MJ Megajoule Mt Metric Ton (Tonne) MW Megawatt MWh Megawatt Hour NPW Net Present Worth SPB Simple Payback Period SRMC Short run marginal cost SWH Solar Water Heating TOE Metric Ton of Oil Equivalent TRNSYS Transient Simulation Program U-Value Thermal Conductivity of Insulation (W/m2, deg C) W Watt TABLE OP CONTS Page Objectives of the Study .................... *.., 1 Approach used for Ftel2dork............................ 2 Structure of Report .................. * .... ,......... 3 Technical Supplements. .................. *........... 4 II. METHODOLOGY POR TECHNICAL EVALUATION ... 5 Selection of Design Techniques....o............o........ 5 Climate in Kenya.....enya............................... 5 Types of SWH Systems Used in Simulations..-,........o... ^ Optimization of Solar Collector Slope.ope..o.o...o...... 6 Selection of Solar Collector Type., 6 _II. ANALYZIGX THE PERFORMANCE OF SWH SYSTEMS ...........7...... Technical Performance of SUH System s t........em...o.o... 7 Commercial Applications . 7 Industrial Applications..... 00....o*0***oeo0.. 8 Institutions and Other Public Sector Applications..... 9 Residential Apca ncations 12 IV. LOCAL PRODUCTION AND COSTS OF SWH SYSTEMS...TEMS*0........ 13 Introduction...... ....o.o..... *0o0o00ooo*000........ 13 System Design Requirementsquirements.........o....o..... 13 Production of Components in Kenya......................., 15 Capabilities for Installation and Maintenance of SWH Systems in Kenya 16 Installed Costs of SWH Systems.o.o...o.............. 16 Marginal Costs for Providing Heat from SWH Systems..... 18 V. ECONOMIC AND FINANCIAL EVALUATION OF SWH SYSTEMS..M....... 19 Overview of Evaluation Methodology...oo...oo,........ 19 Results of Analyses for Target Sectors....co.0 rs000000.0 21 Commercial Sectoro.............. ooo**oo... oo.,oo 21 Industrial Seco e..oc t or*000000000*0.* 23 Public Sector . . o.o......, 24 ro Residential Sec t o r ......** .......... . 26 S u m mary ~~~~~~~~~~~~27 IV. MARKET POTENTIAL ..................................*...... 34 w ~~~~~~Introductionoooooooooo,*o**ooo,,,, 34 Methodology for Estimating Market Potential.o......... 34 Estimates of Market Potential.....o.o.....o......... 35 Market Potential of the Commercial Sector............. 35 Market Potential for Industrial Sectorctor......*. 36 Market Potential for Institutional and Public Sectors .......... *......... 37 Market Potential oi Residential Sector.ctor..,,......, 38 Cumulative Energy Savings in all Sectors tors........ 39 Effect of SWH System Use on Electrical Energy Demand.... 39 1 Market Potential for SWH Syests iv 2 Collector Areas, Energy Savings, and Cost Estimates for Demonstration Projects....... . ..... ..... ... . . e....... vii 3.1 Results of Performance Analysis for Hotels a3ts P res talyis 8 3.2 1Kesults of Performance Analysis for Industistri***es 10 3.3 Results of Performance Analysis for Institutions and Other Public Sector Applicationss..........o........... 11 3.4 Results of Performance Analysis for Residences*e*......... 12 4.1 Cost of Collectors Delivered to Site i te................... 17 4.2 Installed Cost of SWH System.............................. 18 5.1 Suumary of Various Fuel Prices Used in the Economic .............................. ............. ....... . .... 20 5.2 Operation and Maintenance (OM) Costs....... 21 5.3 Economic Rate of Return for the Commercial Sector Applications of SWH Systems Using Representative Economic Prices 22 5.4 Financial Analysis for the Commercial Sector - Botels and Restaurants - Based cn Retail Fuel Prices and No Duty and Sales Tax on Solar Equipment..... 22 5.5 Financial Analysis for the Commercial Sector - Hotels and Rest4urants - Based on Retail Fuel Prices and 25% Duty and No Sales Tax on Solar Equipmentento4... 23 5.6 Economic Rate of Return for the Industrial Sector Applications of SWH Systems Using Representative Economic Prices........ 23 5.7 Financial Analysis for the Industrial Sector - Based on Retail Fuel Prices and No Duty and Sales Tax on Solar Equipment... 24 5.8 Financial Analysis for the Industrial Sector - Based on Retail Fuel Prices and 25 Duty and No Sales Tax on Solar E q u i p m e n t 24 5.9 Economic Rate of Return for the Industrial Sector Applications of SWH Systems Using Representative Economic Pricesr..... 25 5.10 Financial Analysis for the Institutional Sector - Based on Retail Fuel Prices and No Duty and Sales Tax on Solar Equipment.....e n*t0400@ ............ 25 5.11 Financial Analysis for the Institutional Sector Based on Retail Fuel Prices and 25X Duty and No Sales Tax on Solar Equipment.........................* 26 5.12 Economic Rate of Return for the Residential Sector Applications of SWH Systems Using Representative Economic Prices ............ 26 5.13 Financiat Analysis for the Residential Sector - Based on Retail Fuel Prices with and without 25% Duty and no Sales Tax on Solar Equipment..*....9.,..... 27 6.1 Market Potential in the Commercial Sector c t or**......,.... 35 6.2 Market Potential in the Industrial Sectoro................ 37 6.3 Market Potentiai in the Public Sector c t*............or.... 38 6.4 Market Potential in the Residential Sector - Primary Marke0 ........ 40 6.5 Market Potential in the Residential Sector - Secondary Market .......41 6.6 SWH SystemsS Market Potential for all Sectors *'n ena41 :i TRNSYS Simulation ....... ............ 0 43 2a Climatic Data for Renya........... 45 3. Principal Types of SWH Systems........... 50 4. Selection of Solar Collector for Simulations and Production in Kenya........... 58 S. Performance Analysis Results ---Representative Calculations for Various Sectors and Applicationse.......... 60 6. Market Potential Estimates 69 7. Interaction of SWH S)stems with Electric Uti1ityility...o... 75 8. Construction Details of Solar Collectors.................,.. 89 9. SWH Demonstration System for Nairobi Health Center ......... 93 Overview 1. The purpose of this report is to evaluate the technical and economic merits of applying Solar Water Heating (SWH) systems in different economic sectors of Kenya, to assese the potential size of the market for SWH systems in the residential, commercial, institutional, and industrial sectors, given prevailing energy prices, and to outline possible measures that could be adopted by the Government of Kenya (GOK) to promote the systematic development and dissemination of SWH systems in the country. 2. The energy policy of the GOK recognizes the potential for applying solar energy to displace the use of other conventional energy sources (e.g., petroleum products and electricity) for heating water in several sectors. The overall objective would be to reduce the country's dependence on imported petroleum and also to curtail the growing demand for electricity. The potential commercial merits of SWH systems has also been recognized by the private sector in Kenya, and in recent years, about ten Kenyan registered companies have begun operations in different segments of the SWU industry, including the importation of SU systems and/or components, the production and assembly of systems locally, and the installation and servicing of the sytems for users. 3. In 1985, the COK requested assistance from the UNDP/World Bank Energy Sector Management Assistance Program (ESXAP) to thoroughly examine the technical and economic merits of applying SWH systems in Kenya, and to review other pertinent issues relating to the potential market size, the capability of local industry in this field, and the possible measures that may need to be adopted by GOK and other public sector institutions to promote Asytematic development and cost effective dissemination of SWH systems. Principal Findings Technical Evaluation 4. The mission used a state-of-the-art computer simulation methodology, known as the Transient Simulator Program (TRNSYS) to evaluate the technical performance of a variety of SWH systems configurations under Kenyan climatic conditions. A high efficiency collector consisting of a single glass cover and a selectively coated absorber plate, with extra insulation, was used in the evaluation. This type of generic collector was incorporated in five different SWH system configurations: (a) a system with water storage and collector loop heat exchangers; (b) a system with water storage and no collector loop heat - it - exchanger; (c) a system with no storage and no loop heat exchanger; (d) retrofits to existing residential electrical water heaters; and (e) a thermosyphonic system. 5. The results of the TRMSYS simulations for the different SWM system configurations in the industrial, residential, institutional, and commercial sectors indicate that relatively high average collector efficiencies can be achieved in Kenya. Applications in the industrial sector yielded, on average$ collector efficiencies of over 65Z, those for the residential and institutional sector, 551, and those for most enterprises in the commercial sector, over 502, except in small restaurants where the average efficiency was about 35. Economic Evaluation of SWH Systems 6. The mission performed economic end financial analyses for a large number of SWH applications using information collected on prospective sites representing all the target sectors. The analysis were based on the use of optimal design configurations developed through the TRNSYS simulations, estimates of production and installed costs for SWH systerns in Kenya, and a range of economic and market prices for the alternative energy sources. The prices prevailing in August 1986 were used for the base case analysis, and in view of the continuing fluctuations in world market prices for petroleum products, a wide range of sensitivity analyses was also performed (Figures 5.1-5.4). 7. The results of the analyses indicate that the economic rates of return would be above 15Z for almost all the applications examined, the exceptions being applications designed to retrofit fuel oil. 1/ At August 1986 prices for fuel oil, such applications would, in the Kenyan context, yield less than a 151 rate of return. Applications of SWH systems to displace electric water heating systems have much stronger economic merits. The economic rate of return for using SWH systems in the residential sector to retrofit electric water heaters was found to be above 30X, when electricity is priced at the off-peak residential electricity tariff. The economic merits of SWH systems are also encouraging for public institutions where an added benefit would be a reduction in recurrent expenditures due to electricity bills and purchases of petroleum products. 1/ Gasoil is presently being used in some comercial and industrial establishments for heating water. In such cases, substitution with fuel oil may have stronger economic merits than retrofitting with SWH systems. The technical feasibility of such conversions need to be verified. It is generally not practical for residential consumers to switch from electric smater heating systems to fuel-oil fired systems. - iii - 8. The results of the financial analyses also confirm the feasibility of using SWH systems assuming that loans would be made available to prospective users at competitive market rates (13% per antnum). The mission's analyses confirms that full payback could be realised over 10 years if the user were to earmark all or part of the projected savings to service the debt on the purchase of the SWH system, i.e., the reduction in the consumer's monthly fuel bill would be greater than the monthly debt service charge. Evaluation of SWH Market Potential 9. The mission estimated the potential size of the SWH market in Kenya using a three-step approach. The first step was a broad-based survey of present users of hot water (Chapter I). Users were grouped into economic sectors (i.e., commercial, industrial, institutional, and residential), and each sector was then further divided into subgroups more representative of their typical hot water use. For example, textile mills and meat processing factories were divided into separate subgroups within the industrial sector; restaurants and hotels were considered separately under the commercial sector. The second step was to estimate market potential by translating the computer simulation results (Chapter III), market survey data, and information from GOK documents intro estimates of market size. To accomplish this task, ener&y savings in typicat systems within each market subgroup were estimated with the help of TRNSYS simulations. The number of energy users within each subgroup was estimated. The maximum potential energy savings was then derived by multiplying the energy savings per unit with the number of units in each subgroup. The third step was to eliminate potencial applications of SWH systems which, although technically feasible, would not be economically viable, given petroleum product prtces nrevailing in August 1985. In this respect, almost all applications to substitute fuel oii were eliminated, since the economic rata of return was below 15%. 10. The results of the mission's analyses are summarised below in Table 1. At August 1986 prices, the maximum market potential for SWH in Kenya was estimated at about 370,000 m" of collector area, 1/ which translates into a fuel displacement potential of about 120,000 TOE p.a. The most promising market segment is residential where the estimated maximum market potential is about 140,000 m2 of collector area, and the equivalent fuel, displacement potential is about 40,000 TOE p.a. It should be noted that these estimates of market sizes assume 100% market penetration of SVP9 systems. The actual market size which could be commercially significant would be much lower, since the extent of market penetration depends on several other factors such as availability of 2/ SWH systems are commonly defined in terms of the area of the collector array; however, this does imply that several other sub- systems (e.g., storage tanks, heat exchangers) are also involved. - it - credit, awareness of prospective users of SWU systems, the effectiveness of the local SWH industry, Se ,rnment committment, and so on* Table l MARPŁT POTEENTIAL FOR SUH SYSTEiMS (1986) Systaa Collector Maximum Unual Type of Fuel Appilcation Area Requi'nd Energy Savings Displaced {m ) (TOE/yr) Commercial Sector -/ 77,681 30,516 Gas oil, electricity, charcoal, wood, LPG Industrial Sector b/ 22,660 2,241 Fuel oil, gas oll InstitutIonsl Sector cl 127,304 47,556 Gas oil, charcoal, fuelwood, kerosene, LPG, electricity Residentlai Sector d/ 140.639 38,922 Electricity Total 368,506 119,235 o/ Includes hotels and restaurants; hot water used for guest rowms, kitchens, laundry. g/ Hot water used as 'preheat' for boilers to provide low to medlum temperature process heat needs. cl Includes hospitals, health centers, boarding schools, prisons. a/ mainly upper income houses. Hot water used for baths, kitchen, and laundry. Source: Misslon's calculations. Measures to Support SWH Development 11. The dissemination of SWH technologies through commercial channels in Kenya would require the stimulation of demand and the streamlining of industry to respond to that demand. The specific measures and policy issues that must be addressed in this regard are: (a) initiation of a solar information effort including a SWH demonstration scheme; (b) identification of an institutional mechanism to ensure systematic development of SWH technology in the country; and (c) establishment of financing mechanisms preferably backed by legislation to help prospective users of SWR systems to overcome the initial cost barriers. The mission's assessment of the ty es and mix of measures and policy instruments that may be required in Kenya are described below. Information Program 12. Dissemination of information about SWH technology to potential consumers and producers in Kenya is needed to increase public awareness of the merits of this new technology and facilitate its replication. Such an information dissemination effort will also help eliminate some of the negative publicity in Kenya about this technology. The mission recommends that the government disseminate through TV, radio, press, governmental publications, etc. -- information on various aspects of the application of SWI syrtems in Kenya. These would eventually encompass information on: (a) the demonstration program and the results thereof which are expected to confirm the technical and economic viability of SWH systems applications in Kenya, particularly in the residential and public health sectors; and (b) the availability of credit and incentives, the terms and conditions, for gaining access to such credit as well as the potential benefits that would accrue to the consumers and the producers. Details of the demonstration scheme recommended by the mission are presented below (para. 16). Institutional Set-up 13. In order to ensure systematic development of SWH technology in the country, an institutional set-up with the following elements will need to be put in place: (a) Overall Coordination: The mission recommends that the MOERD, through its Renewable Energy Group, should assume the overall responsibility of overseeing the development of SWH technology in the country. The Renewable Energy Group should be provided with proper technical assistance tQ help perform this additionil responsibility (para. 20). The Group should gradually develop its expertise to manage and coordinate a variety of regulatory services including: (i) maintainiag a list of approved solar equipment suppliers and the range of installed costs; (ii) reviewing and approving SWH system designs in non-standard applications (e.g., restaurants and industry) before installation; and (iii) inspecting SWH systems after installation. The Group could also assist in promoting training and manpower development programs relating to SWH systems, and coordinate the implementation of public sector schemes in the SWH field; (b) Production, Installation and Maintenance: Initially, the mission recommends that the existing private companies should be assisted to streamline and upgrade their operations, so that they become capable of producing, installing, and maintaining SWH systems of internationally acceptable standard. The exact form of assistance required by each company should be determined as part of the follow-up to this study, and in consultation with other GOK agencies responsible for industries. (c) Certification: Certification, which is imperative to protect the consumers, shoula be organized by the Renewable Energy Group at MOERD in collaboration with the Kenyan National Bureau of Standards (RBS). In the initial period, the mission recommends that collectors produced or imported for marketing in Kenya should be certified by the KBS in close collaboration - vi - with an internationally recognized laboratory (e.g., in Canada, West Germany or in the USA). (d) Loan Disbursement and Collection: Development finance agencies such as the Industrial Development Bank (IDB), and the Housing Finance Company of Kenya (HFCK) are better equipped to take on this role as the loan disbursing and collection agencies. IDB would provide loans to the SWH industries to help upgrade their capabilities and facilities for producing, assembling, installing, and/or maintaining SWH systems. IDB would also provide loans to industries and commercial enterprises to install SWH systems for process heating needs; and HFCK, which finances housing construction, would provide loans for the purchase and installation of SWH systems in private residences. The mission recommends that MOERD consult with the local finance agencies to develop an appropriate mechanism for loan disbursement and collection to match the criteria and objectives set up for the proposed financing scheme(s). (e) Manpower Development: The mission recommends that technicians should be trained on a regular basis by the PoLytechnic Institute in Kenya where a short course for solar technicians could be started. The mission also recommends that the Engineering and Sciences faculties at the University of Nairobi should introduce courses on SWH systems. No technical assistance is envisagad for this purpose. SWH Financing Mechanisms 14. The lack of access to financing on the part of both the local SWH industry and prospective users of SWH systems is a constraint to the systematic development and dissemination of the technology in Kenva. A Government policy is reeded to support local development finance institutions such as the IDB and the HFCK which have the capability to mobilize funds and establish financing mechanisms and/or schemes to address the requirements of the SWH industry. The mission believes that the appropriate mechanisms and/or schemes can be formulated, through consultation between GOK and the financial institutions, to meet the following requirements and objectives: (a) assisting the different segments of the local SWH industry (manufacturers/assemblers, installers, servicing and maintenance, etc.) to procure equipment and upgrade their facilities; (b) assisting prospective users of SWH systems (i.e., in both industrial/commercial and residentiaL sectors) to finance the purchase and installation of the systems; and (c) assisting the development finance institutions to mobilize funds from local and external sources for the credit schemes, -vii- and also to introduce measures that may be necessary to ensure successful administration of the loan disbursement and collection arrangements. 15. The mission recommends that the COK, through the MOERD, should begin consultations with representatives of the concerned groups on the above issues. Demonstration Projects 16. The mission identified 24 demonstration projects that could be implemented within the public sector, 12 of them in and around Nairobi, and 12 of them in Mombasa (Table 2). The projects consist of two health centers in Nairobi, two dispensaries each in Nairobi and Mombasa, and 8 houses each in Nairobi and Mombasa. Since the residential sector is potentially the most important market for SWH systems in Kenya, several government guest houses are included in the demonstration program. Table 2: COLLECTOR AREAS, ENERGY SAVINGS, AND COST ESTIMATES FOR OEMONSTRATION PROJECTS Total Cost No. of Collector for Imported Total Estimated SWH Application Installations Area Collectors Energy Saved (*n2) (USS) (TJE/yr) Health Center, Nafrobl 2 2 x 86 23,908 37.7 Health Center, Mombasa 2 2 x 86 23,908 37.2 DIspensary, Nairobi 2 2 x 14 3,892 7.0 Dispensary, Mombasa 2 2 x 14 3,892 7.0 Houses on Tariff A, Nairobi 4 4 x 4 2,224 3.5 Houses on TarIff 0, Nairobi 4 4 x 4 2,224 3.6 Houses on Tariff A, Mombasa 4 4 x 4 2,224 Houses on Tariff 0, fonbasa 4 4 x 4 2.224 3.6 Total 24 464 64,496 102.8 Source: Mission's calculations. 17. For each of the demonstration projects, the TRNSYS simulation was performed, and the hourly hot water demand pattern was matched with the output of SWH systems for the whole year to arrive at optimal sizes for collector arrays, storage tanks, heat exchangers, and other components. Detailed schematic drawings were prepared for each demon- stration project and all relevant guidelines for installation and maintenance (tailored to Kenyan conditions) were developed. Also, complete tender documents were developed which can be used by COK to procure the materials and services for the demonstration projects. The information package provided in this report and the accompanying Technical Supplement are therefore considered by the mission to be - viii - comprehensive enough to enable the government to procure, install, and maintain the SWH systems. 18. As an example, the details of sy.stem design and performance, and the projected energy savings for the Hoalth Centre in Nairobi are provided in Annex 9. The instructions to be followed for installing and operating the SUB systems are provided in the Technical Supplements. Recommended Follow Up 19. The mission believes that the MOERD would need further technical assistance to follow-up on the findings and recommendations of this report, in particular to build up the in-house capabilities of the MOERD to coordinate and administer activities in the field of SWH systems. 20. The mission recommends that the GOK should explore the possibility of expanding the scope of ongoing energy technical programs (e.g., with CIDA and GTZ) to cover (a) the services of a specialist (total of about 12 man-months in a 2 year period) with extensive experience in the SUH industry; and (b) the proposed Demonstration Schemes. The role of the specialist would be to assist local counterparts in NOERD to formulate and implement an action plan comprisirg-the following elements: (a) providing on-the-job training to members of MOERD's Renewable Energy Group who would eventually assume full responsibility for coordinating and supervising SWH development and dissemination activities; (b) completing and implementing plans for the proposed SWU demonstration schemes (Table 2); (c) assisting local financial institutions such as the IDB and HFCK to mobilize funds, and to formulate and implement credit financing schemes for both manufacturers and prospective users; (d) assisting local institutions such as the Nairobi Polytechnic to formulate and implement training programs to develop manpower and skills needed in the SWH industry; and (e) arranging and monitoring formal SWH systems training courses for selected personnel in MOERD. 21. The mission believes that the SWH industry in Kenya should concentrate its efforts on producing, installing, and maintaining a range of standardised SVH systems for the residential sector rather than on the 'customized' systems for commercial and industrial applications. This reflects also the mission's assessment that the economic merits of SWU - lx systems as a substitute to electric water heating systems appear to be stronger. 22. Given the above focus, the mission recommends that the proposed technical assistance should focus on requirements (a) to upgrade the capabilities of local SIH industry to supply prospective residential customers; (b) to establish credit financing schemes for projects targeted at the residential segment of the market; and (c) to develop skills pertinent to residential SWH systems. 23. A tentative budget for technical assistance over a 2 year period is as follows. Us$ '000 1. Technical Specialist(s) (total of 12 man-months) 100 2. Training of MOERD Staff 50 3. SWH Demonstration Schemes a/ 100 4. Office Equipment/Facilities for MOSED 20 S. Certification of SH Systems b/ SO Subtotal 320 Contingency (10t) 30 Total 350 a/ Includes hardware, equipment for monitoring systems, etc. b/ Covers equipment and instruments needed by XBS to institute certification scheme for SH systems. I. INTRODUCTION Background J 1.1~ To tackle some of its major energy problems and opportunities, the government of Kenya (GOK) formulated a strategy covering many elements of energy supply and demand 3/ including renewable energy sources. Within this program, the Ministry of Energy and Regional Development (NOERD) recognises the potential in Kenya for applying solar energy for water heating purposes in the residential, commercial, institutional, and industrial sectors (e.g., preheated water for industrial boilers, domestic hot water needs, kitchen hot water for restaurants, etc.). 1.2 In 1984, a mission under the auspices of a Joint UNDP/World Bank Energy Sector Assessment Program 4/ reviewed a prefeasibility study that had been submitted to GOK by consultants on the use of SWH systems in Kenya, and concluded that although the report had made a useful contribution to assessing the technical viability of SWH systems in Kenya, it had not satisfactorily addressed several pertinent issues. Hence its findings could not be considered definitive. Consequently, GOK requested assistance from ESMAP, and in September/October 1985, another mission under ESNAP visited Kenya to investigate in detail the potential for SWH systems in the country. .5/ The present report is the result of that mission. Objectives of the Study 1.3 The principal objective of the study were as follows: (a) determining the economic viability in Kenya of using SWH systems to displace the use of electricity and petroleum 3/ Kenya: Issues and Options in the Energy Sector, World Bank UNDP Report No. 3800-KE, May 1982; and Jack M. Hollander, et al., Energy Conservation in Kenya: Programs, Potentials, Problems, University of California, September 1981. 4/ Joint UNDP/World Bank Energy Sector Management Assistance Program, Kenya: Energy Assessment Status Report, November 1984. 5/ The mission comprised Messrs. M. Anwer S. Malik (Mission Chief), S. Faruq Ahmed (Principal Investigator), Torben Esbensen (Con- sultant) and Ms. Manon Muller (Researcher) who visited Kenya from September 23 - October 4, 1985. -2- products for heating water in the residential, commercial, institutional, and industrial sectors; (b) evaluating existing capabilities- of local industry to produce,, install, and service SWI systems; and (c) estimating the size of the potential market for SWH systems in the above sectors, projecting the associated fuel displacement -potential (both as retrofits and new installations), and analyzing the potential effect of SW system use on electrical energy demand. 1.4 Assuming the economic viability of SWH system applications was confirmedt, the study would also cover formulating recommendations on how the Government of Kenya could systematically promote further development and dissemination of SWH systems through private commercial and public sector channels. It was envisaged that such recommendations would incorporate a range of policy insteuments such as legislation, credit financing schemes, training programs, and so on. Approach used for Fieldwork 1.5 The apprtach used by the mission during the field work in Kenya consisted of: (a) interviews and collection of data from agencies and individuals in the public and private sectors who could influence the development of SWH technology in the country; and (b) field visits to and data collection from a number of representative potential users of SWH systems in various sectors, plus existing solar equipment suppliers/installers, and workshop/sheet metal companies. The purpose of the field vis-ts was on the one hand to develop a 'sample' size large enough to generate reliable estimates of the market size for SWH systems in the country; and on the other to survey sufficient workshops/factories to assess capabilities of local industries for the production, instal- lation, and maintenance viable SWH systems in the country. 1.6 The key agencies visited during the mission included: the Ministry of Energy and Regional Development (MOERD); Ministry of Industry; Ministry of Health; Central Bureau of Statistics; Ministry of Finance and Planning; Kenya Power and Light Company (KPLC); Meteorological Department; University of Nairobi; Tourism Development Corporation; Ministry of Housing; Ministry of Education; Housing Finance Company of Kenya; private sector groups; and bilateral/multilateral donors. 1.7 Two sets of field visits covering a total of 993 sites were completed. For the first set of field visits which sought to determine the potential market size, detailed questionnaires were prepared to assess the potential of SWH use for various end users and sectors. A group of 13 engineers from MOERD was trained to collect field data in -3- association with the mission members. The visits covered the four major energy sectors described below. 1.8 Commercial Sector. Twenty-three hotels were surveyed in Nairobi and Mombasa, all of which require varying amounts of hot water heated by fuel oil or electricity. Also surveyed were 95 small restaurants in and around Nairobi and Moftbasa. These restaurants heat water with electricity or fuels such as kerosene, LPG, charcoal and wood. 1.9 Industrial Sector. Thirty industries were surveyed in Nairobi, Mombasa and Thika, and most of them were found to use hot water. The industries surveyed included soap and oil, tanneries, textile, canning, bottling, dairy, paper and pulp, food processing, and chemicals. In these industries water is heated mainly by fuel oil under typical industrial settings. 1.10 Istitutional Sector. Thirty-six sites were visited which included Kenyatta Hospital, University of Nairobi dormitories, plus a number of boarding schools, and small health centers. Army barracks, police and civil service training colleges could not be visited, and hence their potential for SWH use could not be assessed. It was dis- covered that the institutional sector uses a variety of fuels (elec- tricity in urban areas, kerosene, LPG, fuel oil, gas oil, wood, and charcoal) to heat water. In some cases, electric water heaters are used, while in others, a central boiler is used; in rural areas, water it. generally heated over an open flame employing wood or charcoal. 1.11 Residential Sector. A group of 769 upper and upper-middle *ncome houses was surveyed. Of these, 91 were "sall" houses (less than 150 m'), 484 were medium-sized houses (150-250 m'), and 173 were large houses (over 250 m2). Twenty-one houses did not report the area. About 97% of upper and upper-middle income households were found to use hot water heated by electricity; 2.2% did not use hot water, and 0.8% did not respond. 1.12 T,e second set of field visits carried out by the mission members covered manufacturers and importers of the existing solar collectors and the sites where SWH systems had already been installed. These visits also covered the assessment of production, installation, and maintenance capabilities in the country and concentrated on 40 work- shops/factories in and around Nairobi. Structure of Report 1.13 The remaining sections of this report are structured as follows: Chapters II and III review the methodology used for assessing the technical merits of applying SWH systems in Kenya; Chapter IV extends the evaluation to local requirements and capabilities for producing, installing and maintaining SWH systems; Chapter V evaluates the economic -4- and financial viability of SWH applications in the different sectors; and Chapter VI translates the results of surveys by the mission into a broad assessment of the market potential given energy prices prevailing iti August 1986. Technical Supplements 1.14 This report is supported by two volumes of Technical Supple- ments which include: (a) a comprehensive consultant technical supplement which covers various aspects of the development of SWH technology in Kenya; and (b) climatic data (in tabular disc, and tape forms) from Kenya; (c) computer-printed evaluations of SWH system performance (Chapter III) and other support materials. -5- II. NMTHOIOLOGY FOR TECHNICAL EVALUATION Selection of Design Technique 2.1 The first step in selecting the most economic SWH system to meet a particular hoa water demand is to choose a design technique. A number of design techniques are currently available, the most accurate of which uses the 'detailed computer simulation'. The state-of-the-art computer simulation used to evaluate the performance of SWH systems in Kenya -- and adapted to fit the local Kenyan conditions -- is TRNSYS (Transient Simulation Program) which can be used for most geographical locations, and in addition to being highly accurate, is suitable for evaluating the performance of SWH applications. Details about the TRNSYS design method are given in Annex 1 and the Technical Supplements. Climate in Kenya 2.2 The climate in Kenya is well suited for the application of SH systems. Most areas in Kenya experience good year-round solar radiation coupled with moderate to high temperatures. Since the climate in areas most likely to use SWH systems is fairly similar to that of Nairobi, the Nairobi weather data has been used for most computer simulations. How- ever, a few of the simulations (e.g., for industries and hotels located in the Mombasa area) were based on the Mombasa weather data. In Kenya, the solar radiation values were available on a daily basis. The method used for converting daily solar radiation into hourly values (i.e., the form in which they are to be used in TRNSYS Simulations) is given in Technical Supplements. Some representative climate data for Kenya is shown in Annex 2. Types of SWH Systems Used in Simulations 2.3 The solar engineer has the option to design a variety of SWH systems through TRNSYS simulations. Depending on the intended end-use, a number of SWH systems with different components can be used. For this project, the mission examined five different systems: (a) a system with water storage and collector loop heat exchangers; (b) a system with water storage and no collector loop heat exchanger; (c) a system with no storage and no loop heat exchanger; (d) retrofits to existing residential electrical water heaters; (e) a thermosyphonic system. The details of various SWH systems are given in Annex 3. -6- Optimization of Solar Collector Slope 2.4 Most of Kenya is situated between 5' north and Se south lati- tudes. The optimum slope (from the horizontal) for deploying the col- lector arrays (which would maximize the interception of solar energy) was determined by the mission to be 0. However, to ensure proper drainage of the solar collector array, a small slope of 5' facing due south was used. Selection of Solar Collector Tvpe 2.5 There are literally hundreds of collector designs available all over the world from which to choose for production in a country such as Kenya. The mission narrowed the choice to three generic types, all using a single glass cover: (a) Type A is a high efficiency collector with selective coating on the absorber plate and extra insulation; (b) Type B is a good collector with a selectively coated absorber plate and medium insulation; and (c) Type C is a low-efficiency collector with non-selec- tive (flat-black) absorber coating and low insulation. The mission performed TRNSYS simulations for specific applications and determined that Type A is the most cost effective of the three collector types. This finding is consistent with solar engineering design experience in other countries. 2.6 Collector Type A was therefore used in simulating the per- formance of various SWW systems (Chapter III), and this collector type was recommended for production in Kenya (Chapter IV). Some of the details of collectors A, B, and C are given in Annex 4. Table 3.Lt RESULTS OF PERFOCFtANCE ANALYSIS FOR HOTELS AND RESTAURANTS Average Annual Units of Fuel Used Amount -Size of Efficiency Commercial Comerclal for Water of Hot Solar Collector of Solar Energy Application Activity Heating Water Used Array Collector Saved (liters (02) (1) (TOE/yr) per day) Pan Afrique Hotel/Nairobi 200 beds Electricity 12,000 130 58.5 33.1 a/ Mt. Kenya Safari Club/ Nairobi 140 beds Fuel Oil 10,500 120 58.0 17.5 Nya lI Beach Hotel/Mombasa 350 beds Fuel Oil 21,000 240 55.0 38.7 Siver Beach Hotel/Mombasa 180 beds Electricity 10,800 120 55.2 31.7 a/ Diplomat 400 CafeANairobi meals/day Electricity 1,600 i8 61.2 5.5 a/ Cafe/Nairobi 3O0 meals/day Electricity 1,200 12 64.t 4.0 a/ Small Res- 50 taurant/Rural meals/day Charcoal 38 2 35.9 0.5 Small Res- 50 taurant/Aural meals/day Wood 38 2 46.6 0.O _/ Efficiency of fuel use is 100%. Source: Mission calculations. Industrial Applications 3.5 Of the 14 representative industries which were simulated, 8 are in Nairobi, and 3 each in Thika and Mombasa. Most of these industries work 2 or 3 shifts per day for 280 to 365 days per year. None of the industries examined are seasonal. While the fruit and vegetable canning industry usually is seasonal, in Nairobi's mild climate even this is a year-round industry. The background information and the performance of SWU systems for these representative industries are presented in Table 3.2. 3.6 The SWH system chosen for these applications is the open loop system (para. 2.3) in which boiler make-up water is heated in the col- lectors to temperatures that vary throughout the day (according to the variations in climate and especially the solar radiation) and then supplied to the boiler water pre-heating system. This partially heated water is then heated with conventional fuels to the temperature required III. ANALYZING TUE PERFORMANCE OF SUH SYSTEMS 3.1 The mission used the TRNSYS simulations described in Chapter 1I to generate the (technical) performance analysis results. A number of applications were modeled, including: (a) commercial establishments such as hotels and restaurants; (b) industries; (c) institutions such as hospitals and schools; and (4) residences. Technical Performance of SWH Systems 3.2 Of the sites visited by the mission (para. 1.8-1.11), 45 were chosen for simulations to evaluate their technical performance. These included 8 hotels and restaurant3# 14 industries, 14 institutional appli- cations and 9 residences. TRNSYS data files were created for specific use in Kenya. The simulations yielded extensive information on system/ subsystem performance which included, among other things, the optimal size of the collector arrays and the associated fuel displaced. The information produced by the simulations was coupled with that obtained in the field, and the market potential for SWH use in different sectors was estimated. The main results of the simulations are presented below. Additional supporting information for representative applications in various sectors, is provided in Annex 5. Commercial Applications 3.3 The analysis of commercial applications focused on hotels and restaurants in Kenya. Table 3.1 summarizes the size of a few repre- sentative commercial establishments and the performance of the SWH system for each. The SWH system used for most applications is the one with thermal storage (para. 2.3). 3.4 The last column of Table 3.1 shows the energy saved by SWH systems. The rather large energy savings is explained by the low efficiencies of existing hot water systems which do not use elec- tricity. For example, the average annual efficiency of fuel oil boilers in hotels is approximately 551 because the boilers are grossly oversized for the average hotel occupancy of 451. Similarly, the small rural restaurants use wood or charcoal with fuel conversion efficiencies of about 10% and 151, respectively. On the other hand, in the small restaurants and hotels which use electricity, the conversion efficiency is nearly 100l. The average yearly efficiency of solar collectors for most applications was found to exceed 50Z except for rural restaurants, where it is about 351; the reason for this low efficiency is that th amount of hot water used for 50 meals per day is very small for a 2 m minimum area solar collector implying a lower collector efficiency. -9- by the specific industry. Se-eral solar collectors are connected in a series to obtain the desired range of temperatures. No storage tank is used. In the simulation, the boiler efficiency was assumed to be 70Z. In fact, in many industries it will be much lower; hence, the SWH performance calculations represent a conservative estimate. The results of the performance analysis shown in Table 3.2 indicate that the solar collectors operate at fairly high efficiency (over 652) because of the open loop system. The actual energy saved (TOM/i) varies for different industries because some industries do not operate all 365 days per year. Institutions and Other Public Sector Applications 3.7 Fourteen sites were selected to analyze the performance of SWH systems in the institutional sector in Kenya. At most of these sites, the SWH systems were intended for use in the kitchen and bathroom except for rural school dormitories, where the use was for kitchens only. The typical SWH system used for hospitals was closed loop with a collector heat exchanger and storag4; for all other applications, systems with storage and no collector loop heat exchanger were used. For small systems in rural areas, a thermosyphon system was used (para. 2.3). 3.8 Table 3.3 provides information on the hot water used and the performance of SWH systems at the 14 study sites. The hospitals operate all pear; health centers and dispensaries operate 5 days per week; and schools operate 9 months per year (September through June). The energy saved per year for various applications has been determined after con- sidering the schedule of operation and the efficiency of fuel use. Table 3.2: i?ESULTS OF PERFORANCE ANALYSIS FOR INDUSTRIES Size of Average Units of Fuel Used Schedule Solar Efficiency Industrial for of Not Water Collector of Solar Energy Industrial Application Location Product Activity Water Hieaong Operation Used Array Collectors Saved (days/yr) (liters/hr) (p2) (S) (TOE/yr) Oil Extraction, Ltd. Nairobi Cooling Oil 7 a/ Fuel oil 200 2,000 324 67.1 30.0 Kenya Breweries Nairobi Beer 191 b/ Fuel oil 290 2,400 360 65.2 47.0 Kenya Canneries Thika Canned Fruit 4.3 c/ Fuel oil 280 3,700 558 68.3 73.4 Elliot's Bakery Nairobi Bread 270,000 d/ Gas oil 365 2,500 378 68.3 67.9 Dondora Creamery Nairobi Milk 110 b/ Fuel oil 365 2,000 32 67.1 54.9 Kenya Meat Com. Nairobi Neat 4,58 a/ Fuel oil 360 10,000 1.600 67.3 268.0 B.A. Tobacco Kenja Nairobi Tobacco 4,949 a/ Fuel oil 251 1,000 ISO 68.4 17.7 Firestone, E.A., Ltd. Nairobi Tires 19 el Fuel oil 360 5,500 828 68.3 141.0 Kenya Paper Mill Nairobi Paper 5,200 a/ Fuel oil 360 1,400 210 68.4 35.7 Bullet's Tannery Thika Leather 1.6 f/ Fuel oll 290 6,000 900 68.4 123.6 Thika Cloth Mill Thika Cloth 12 7/ Fuel oil 365 7,000 1,050 68.4 181.4 Kenya Meat Comm. Mombasa Heat n/a Fuel oil 365 8,200 1,230 67.0 212.2 E.A. Brewery Mombasa Beer 240 b/ Fuel oil 290 2,400 360 67.0 49.3 Guishan Bakery Mombasa Bread n/a Gas oil 365 1,000 150 67.0 25.8 a/ MITday. b ZMillion liters/year. _f Million cases/year. d/ Loaves/day. e/ Million pounds/year. 7f Million square feet/year. Source: Mission calculations. I S , Table 3.3: RESULTS OF PERFORiMANCE ANALYSIS FOR INSTITUTIONS AND 0THER PUBLIC SECTOR APPLICAtIONS Average Units of Site Efficiency lnstitu- Fuel Schedule Hot Water of Solar of Public Sector tional Used for of Used Collector Solar Energy Application Location Activity Water Heating Operation Per Day Array Collector Saved (lIters) Wm) (5) (TOE(yr) Mater Hospital Nairobi 300 b Fuel oil 365 e/ 24,000 274 58.5 36.9 Kenyatta Hospital Nairobi 700 b/ Fuel oil 365 eJ 56,000 640 58.6 86.3 A I Khan Hospital Nairobi 220 bl 200 / Fuel oil 365 e! 19,800 226 58.5 30.4 Dispensary 2 Shifts Nairobi 60 cl Electricity s f/ 300 4 64.8 0.8 Health Center Nairobi 500 cl Electricity 5 f/ 7.500 86 68.3 21.9 Dispensary Nairobi 250 c/ Electricity 5 f/ 1,250 14 68.6 3.5 Health Center Mombasa 500 cl Electricity 5 Sf/ 7,500 86 65.8 21.3 Dispensary Mombasa 50 c/ Electricity 5 ±/ 1,250 14 66.3 3.3 Health Center Rural S00 cJ Kerosene 5 Li 7,500 86 68.3 50.3 Dispensary Rural 250 cl Kerosene 5 f/ 1,250 14 68.6 8.0 University of Nairobi Dormitory Nairobi 6,000 d/ Gas oil 9 h/ 240,Onn 2,742 60.1 397.4 School Dormitory Mombasa 300 d/ Gas oil 9 h/ 9,'4i 100 57.6 13.3 School Dormitory Rural 300 da Gas oil 9 h/ 2,700 30 59.9 8.1 a/ This Is the actual energy saved after considering the schedule of operation. b/ Beds. c/ Patients/day. i/ Students. e/ Daystyear. t/ Days/week. j/ Outpatients/day. hi Months/year (September through June). Note: The efficiency of fuel use of fuel oil and gas oil is 60%. For open flame heating for kerosene and wxod, it Is 16% and 10% respectively. For electricity, It is 100%. Source: Mission calculations. - 12 - Residential Applications 3.9 In Konya, SWH systems can be used in residential settings for kitchens, bathrooms, and all other household applications. The system considered for this application is the water storage type without a collector loop heat exchanger (para. 2.3). This analysis is limited to upper and upper-middle income households since this is the only group which uses domestic electric water heaters in the residential sector. For each of the cities of Nairobi and Mombasa two different cases were examined: (a) large houses which use hot water for kitchen, bathroom, and all household appliances; and (b) small houses which use a SWH system only for the kitchen and bathroom. The simulation results are summarized in Table 3.4. Average collector efficiences are on. the order of about 55Z and the energy savings through the use of SWH systems are significant since they displace electricity. Table 3.4: RESULTS OF PERFORMANCE ANALYSIS FOR iRESIDENCES Size Average Number of Fuel Hot of Solar Efficiency iResidential people in Used for Water Collector of Solar Energy Application Location the House Water Heating Used Array Collector Saved 1I1tes/l (S2) (TOE/yr) (kWH/yr) day) Large House Nairobi 6 Electricity a/ 450 6 55.6 1.61 6,531 Small House Nairobi 8 Electricity I/ 360 4 57.9 1.03 4,518 Large House Mombasa 6 Electricity a/ 450 6 53.9 1.49 5,973 Small House Mombasa 8 Electricity a/ 360 4 55.7 0.92 4,025 a/ The efficiency of electricity use is taken as 100%. Source: Mission calculations. - 13 - IV. LOCAL PRODUCTION AND COSTS OF SWH SYSTEMS Introduction 4.1 The potential fuel savings from implementing SWH systems can only be realized if the systems perform satisfactorily over their typical design lifespans of about 15 years and if they are cost effective. The technical reliability and cost are in turn dictated mainly bys (a) the design requirements (that the system components are subject to); (b) production (manufacture, assembly or imports); and (c) installation/ maintenance costs of SWH systems. This chapter first provides a brief review of the system design requirements. Then the production of the system components is discussed, giving special consideration to manufacture/assembly in Kenya. Local capabilities for installing and maintaining SWH systems are also reviewed. The Chapter ends with the mission's assessment of the costs of installing SWH systems in Kenya. System Design Requirements 4.2 SWH systems for use in Kenya have to be designed to meet the climatic and end-use related conditions in the country. Consequently, a number of design constraints have to be placed on various components in the SWH systems, some of which may be unique to the Kenyan environment. The key constraints that were placed on the collectors by the mission are presented below. Not only are these constraints the most crucial from a system performance standpoint, but also from the point of view of economic viability, as the collectors often account for more than 60X of the system cost. (a) A single collector type should be used in Kenya so as to simplify production, quality control, marketing, material procurement, systems installation and maintenance. This collector should be able to accommodate all hot water and industrial preheating needs in the residential, commercial, instititutional and industrial sectors. (b) The collector should not only be able to meet the hot water and industrial preheating requirements in the domestic market, but also be able to serve aJditional end uses such as cooling/refrigeration and desalination. (c) The collector should have the lowest life cycle cost (US$/GJ) over its operational life (about 15 yeara). (d) The collector should be efficient in its energy collection, and the drop in efficiency over its 15-year life should be small (preferably less than 5%). - 14 - (e) The collector should use water as the heat transport fluid and dispense with expensive nonfreezing fluids (e.g., ethylene glycol), since freezing is not a problem in Kenyan urban areas. (f) Copper tubing would be used in the collector to avoid corrosion. (g) It should be possible to drain the collector even in a nearly horizontal position, since the optimal angle at which they would be deployed in Kenya is small (5o). (h) A mechanism should be installed in the collectors to guard them against the high ultraviolet radiation experienced in Kenya. (i) The collector box should be air, moisture, and dust tight. (j) The collector should have a single, high-quality, high-strength -lass cover which can adequately withstand thermal stresses and from which dust can be easily removed. (k) The collector should be of reasonable size and weight for easy transport and maintenance. (1) Attachment of collectors to the support structure should be simple and easily replicated. 4.3 Similar design requirements were identified by the mission for the storage tanks, controls, piping, heat exchangers and other components of the SWH systems. These requirements are discussed in the Technical Supplements. 4.4 The mission then developed the designs for different components, keeping in mend the various design constraints for each component. (Again, only the design for the solar collectors is discussed here, while that for other components is included in the Technical Supplements). After the designs were proposed, plans were developed to manufacture, assemble, or import the components. 4.5 The state-of-the-art solar collector which was chosen by the mission for the analyses in Kenya is shown schematically in Annex 8. The collector comprises a selectively coated absorber plate, a single glazing, back insulation, metallic sidings, and a back metallic sheet, boxed in and sealed to produce an air, dust, and watertight structure. The absorber plate, which from the manufacturing standpoint is the most complex component of the collector and which largely determines its efficiency, may initially have to be imported. The state-of-the art - 15 - absorber plate is selectively coated and consists of aluminum strips with built-in copper tubes. 6/ 4.6 A number of the locally based engineering firms should be capable of developing expertise to design SWH systems. Training could be organised through continuing education programs at the Engineering Faculty of the University of Nairobi. Additionallyt local engineering firms could gain access to relatively simple computer software (computer- aided design techniques) which would facilitate the process of optimally matching components of SWH systems prior to their actual assembly and installation (Annex 1). Production of Components in Kenya 4.7 Nearly all the existing local companies could, with limited training and exposure to better design techniques, upgrade their capabilities to produce, assemble, install, and maintain cost effect and reliable SWH systems. 4.8 There are currently ten main companies involved in the production and importation of SWH systems in Kenya. Of these, four produce solar collectors as their main activity, three produce collectors as a secondary activity, one is planning to launch a large production line of collectors in the near future, and the remaining two import finished solar collectors from Israel and Belgium. The storage tanks, the second most important component in the SWH system, are produced by a number of Kenyan companies for diverse local applications. By and large, these tanks are suitable for use in SWH systems. Until now, the systems installed by the Kenyan companies have performed with modest reliability. In most cases, the installed costs of the SWH systems produced on imported by these companies is high -- on the order of $200- $350 per m2 (exclusive of sales taxes and import duties). The high installed costs are due, in large part, to the choice of sub-optimal designs, and excessive dealer mark-ups. 4.9 The major equipment needed for the assembly of solar collectors include: (a) shearing machine for cutting steel sheets; (b) bending machine for bending steel sheets; (c) welding plant for assembling the collector casing; (d) cutting facilities for cutting mineral wool insulation; (e) soldering plant for connecting pipes; (f) painting facilities for corrosion protection; and (g) glue pistol for sealing the collectors. The mission estimates that with exception of Petrosun each of the companies will require to invest on average, about US$40,000 in machine tools. The mission found that some companies are adequately 6/ The tubes are metallurgically bonded to and completely enclosed by the aluminum strips to result in light and highly efficient plates. -16- equipped for assembling solar collectors and would therefore not require additional investment in new machine tools. The specific requirements for each company would however, need to be determined on a case by case basis. 4.10 Many of the components and materials required for producing SWH systems are available locally in Kenya. Such components and materials includes 1 um steel plate; connecting tubes and copper fittings; mineral wool, soft type, 100 mm; mineral wool, hard type, 50 mm; rubber sleeve; aluminum flashing; corrosion protection paint; storage tanks consisting of heating exchangers, differential thermostats, expansion tanks, valves, fittings, pipes, etc); the support structures for collectors may by welding together locally available angle irons. The other SWH components which may have to be imported until they can be made locally include: selectively coated absorber plate plus manifolds; tempered glass covers; silicone sealants. butyl rubber lining. Capabilities for Installation and Maintenance of SWH Systems in Kenya 4.11 To sustain a SWH industry in Kenya, capabilities have to exist or must be developed for installation and maintenance. The mission discovered that skills for installation and maintenance are available in Kenya especially through some of the large local sheet metal fabricating copanmies and workshops. However, some specialized training would need to be provided to a select number of individuals to expose them to many of the pitfalls which have been experienced in industrialized countries, regarding the satisfactory operation of SWI systems. The requisite training can be provided through the technical assistance component of tha proposed SWH project, drawing on the detailed instructions which are provided in the Technical Supplements. The Polytechnic Institute in Nairobi can also play an important role in training through its three- year technology courses which produces skilled plumbers, welders, electricians, and other technicians who would be capable of producing, installing, and maintaining SWH systems. Only some minor adjustments in the curricula of the Institute may be called for to help it &,eet the specific requirements of the SWH industry. Installed Costs of SWH Systems 4.12 The installed cost of a SWH system comprises a number of elements which include: (a) the cost of components purchased in the industrialized countries; (b) transportation to Kenya; (c) inland transportation from port to the factory within Kenya; (d) the delivery (to the factory) cost of locally available materials; (e) transportation of components/systems from factory to the installation site; (f) labor charges for production and installation; and (g) dealer markup. - 17 - 4.13 Assuming that collectors will be assembled in Kenya from both locally manufactured and imported cotuponents, the mission calculated a representative installed cost for a SWH system in Kenya. The calculations assumed that: (a) imported materials (e.g. collectors) would land at Mombasa; and (b) the assembly and manufacture would take place in Nairobi. To determine the import cost of collectors, i.e., the most expensive component in the SWU system, bids were obtained from the major suppliers in France, Denmark, Italy, and Canada. Obviously, price is a function of the quantities purchased. Internaticzal and local transportation costs were used to determine the factory-delivered costs of the components and other materials purchased in the local market. Local skilled and unskilled labor rates and their productivities were taken into consideration to develop ex-factory costs of collectors. Similarly through evaluating bids from local and foreign firms, the cost of support structures, storage tanks and other imported components was determined to arrive at the installed costs of SWH systems. The accuracy of the cost estimates was confirmed through detailed discussions with the local sheet metal factories and workshops. For all imported components, the customs duty was assumed to be 25% but sales taxes on imported and locally made SWH systems components would be waived. 4.14 The mission estimated the ex-factory cost of the collectors to be US$72.10, when no custom duty and sales tax are considered, and US$84.32 when custom duty at the rate of 25% is considered on imported items. The breakdown is as shown in Table 4.1. Table 4.1: COST OF COLLECTORS DELIVERED TO SITE Cost Without Cost-with Item Custom Duty Custom Duty a/ uss/.2 US$/m2 Absorber Plate 33.60 42.00 Tempered Glass 6.80 8.50 Mineral Wool 4.70 5.87 Other Components (Sealant, Butyl Rubber, etc.) 3.80 4.75 Local Materials 21.30 21.30 Lebor . 1.90 1.90 Total 72.10 84.32 a/ Custom duty 25S on imported components; no sales tax. Source: Mission estimates and GOK sources, 4.15 In order tI arrive at the installed cost of the system, representative 120 m system was considered which in ludes a 16.19 m (4,000 U.S. gallons) storage tank and heat exchgnger. The installed cost of the system was found to equal US$126 per ml when no custom duty and sales tax are considered, and about US$140 per m when a custom duty of 25S is applied to the imported components. Table 4.2 shows the breakdown - 18 - of these costs. For econolic analyses (pars. 5.4), the installed cost estimated is US$131 per m since a 201 foreign exchange premium is applied. Table 4.2: INSTALLED COST OF SWN SYSTEM Cost Without Cost with Item Custom Duty Custom Duty a/ iUSS,.sH USSAU2 Solar Collector 72.10 84.32 Storage Tank 11,12 11.12 Meat Exchanger, Pumps Differential Thermostat, etc. 4.95 6.19 Piping 8,45 8.45 Insulation 8,37 8.37 Valves, Fittings 2.25 2.25 Support Structure 3.80 3.80 Transport to Site and Labor 4,96 4.96 Dealer 1000 _10.00 Total 126.00 139.46 a/ Custom duty 25S on imported components; no sales tax, Source: Mission estimates and G0K sources. Marginal Costs for Providing Heat from SWH Systems 4.16 Although SWH systems are not identical to electricity generat- ing equipment because they do not provide fixed "kW" generating capacity, LRkC (long run marginal cost) and SRMC (short run marginal cost) can still serve as measures for comparing the economic value of the heat available from solar and electrical sources. For SWH, a system that produces under Kenyan conditions 4.07 GJ/m Iyr with its pumps operating 3,478 hours per year, 15 year life and 141 interest rates, the LRMC was calculated to be USC1.726/kWh. The SRMC for a SWH system is quite low (attributed mainly to operating electrical- pumps in the system), and was determined to be USCO.254/kWh resulting in a total marginal cost of USC1.98/kWh. This results in considerable savings when compared with the marginal cost of generating electricity from steam generating plants in Kenya (i.e., USC7/kWh) and providing off-peak power in Kenya which would be well in excess of USel.98/kwh. - 19 - V. COONOMIC AND FINANCIAL EVALUATION OF WME SYSTE(S Overview of Evaluation Methodology .. 5.1 The economic and financial viability of applying a number of representative systems whose technical performance was studied through simulations in Chapter III were evaluated by the mission. In evaluating the SUH systems, benefits were determined by simply translating the fuel savings - as projected by the simulations - into monetary terms. The costs of various SWU systems were based on the data presented in Chapter VII which are the costs achievable through optimal production techniques recommended in this report. The results of the economic and financial analyses along with the main conclusions regarding the economic viability of the SUH systems, are described in this chapter. 5.2 The benefits of the SWH system can be summarized for a given user category with the use of one or several evaluation criteria, such as rate of return, net present worth (VPW), payback period, savings to investment ratio, discounted benefits to cost ratio, etc. This report uses the evaluation methodology which follows from the one described by the World Bank for DFC projects. 7/ Annual expenditures are estimated over the 15-year useful life of the solar equipment. The merit of a given application is then calculk ted by determining the economic and financiai rates of return. 5.3 In the economic analyses, the rate of return was calculated with no discounting (i.e., 0% discount rate) and using the economic prices of fuels (Table 5.1). This approach shows the value of each SWH application to GOK from the national standpoint. The estimates of the economic prices of the fuels/energy sources to be substituted by solar energy were derived as follows: (a) for petroleum products, the import prices (c.i.f. Mombasa) in August 1986; (b) for electricity, the &ong-run marginal cost for electricity delivered to the target consumer categories; and (c) for woodfuels, the economic cost of supply in Kenya. In order to capture the effects of the fluctuating international market prices for, petroleum products, sensitivity analyses of the economic viability of SWH applications was performed for a range of economic prices and fuel price change scenarios. These are presented in Figures 5.1-5.4. 5.4 The estimates of operation and maintenance costs for the economic analyses are defined separately in Table 5.2 for SWH applications in the different sectors. The economic life of SWH 7/ Duvigneau J. -Christian; Ranga N. Prasad, Guidelines for Calculating Financial and Economic Rates of Return for DFC Projects, World Bank Technical Paper No. 33, ISS 0253-7494, 1984. - 20 - equipment ii assumed conservatively to be 15 years, and no salvage value is assumed. A foreign exchange premium of 202 is incorporated in the analyses. 5.5 The financial analyses is done from the standpoint of the prospective user of SWH systems. The market prices of the fuels/energy sources to be substituted by solar energy (Table 5.1) are used, i.e., the retail prices and power tariffs prevailing in August 1986. For sensitivity purposes, two scenarios of possible annual rates of escalation in prices (02 and 2.52) relative to those prevailing in August 1986, are used. Also, the financial analyses is done for both the case where SiH equipment includes a 25 excise duty and where no excise duty is levied. Financing for SWH systems is assumed to be available at a range of commercial interest rates (112, 132 or 162). Other assumptions used in the financial evaluation are that: (a) the duration of loans for all SWH applications is 10 years; (b) end-of-year convention would be acceptable to all parties; and (c) prospective users will be able to cover all debt service payments for SWH systems entirely out of savings accruing to funds that would otherwise have been used to pay bills for heating water with conventional fuels. Table 5.1: SUMKARY OF RETAIL AND ECONOMIC PRICES USED IN THE EVALUATION Retail Price Price Per Price Per Price Per Price Per Economic a/ Fuel Unit Unit MT TOE TOE b/ Price Per TCE b/ (KSH) (KSH) (KSH) (USS) (USS) Gas Oil liter 5.00 5,808.00 S,608.00 363.00 140.00 Fuel Oil liter 1,51 1,657.00 1,726.00 108.00 81.00 liter 1.88 2,063.00 2,148.00 134.00 107.00 LPG kg 5.89 5,890.00 5,557.00 347,00 276.00 Kerosene liter 3.47 3,874.00 3,835.00 240.00 193.00 Charcoal MT 1,750.00 1,750.00 2,573.00 161.00 161.00 c/ wood MT 250.00 250.00 781.00 48.00 48.00 Electricity kWh Residential Tariff A d/ kWh 1.06 - 4,274.00 267.12 Residentilo Tariff 0 I/ kWh 0.61 -- 2,460.00 153.75 - CommercIal */ kWh 0.70 2,822.00 176.37 - Industrial f/ kWh 0.60 2,419.00 151.00 Economic PrIco of Electricity kWh - - - 178.00-222.00 a/ Minimum In this range represents import prices (c.i.f. Mombasa) In August 1986. b F foreign exchange rate used is USS1.00 * KSH 16.00. c iniaum value of economic price Is assumed to be the same as retail price. i/ Residential tariffs A and 0 are regular and Interruptible supply respectively and Includes tariffs A , A1, and D . .1 Commerciat tariff 8, ?ncludes tariffs 8.,1 B2, oE ,and 833 f/ Industrial tariff C, includes tariffs C1, C2, and C3. Source: KPLC. - 21 - 5.6 The' results of the financial evaluation for each SWH application are presented below in terms of a Financial Net Present Worth (MN) at 25 discount rate. This discount rate which is relatively highp, is assumed by the mission to be representative of the opportunity cost of capital to prospective users of SWH systems in Kenya. A positive NPM indicates a viable project; the magnitude of the NYW indicates the relative attractiveness of the project from the standpoint of the prospective user. Table 5.2: OPERATION AND MAINTENANCE (MCM) COSTS Maintenance Operation Cost/Year Cost/Year Sector of Economic Base Annual Rate Base Annual Rate Appilcation Life Cost of Increase Cost of Increase (years) (USS/*Z of (S) (USS/ZW of (S) collector) collector) CommercalI Htels 15 2.25 2.5 0.75 0.5 Restaurants 15 1.80 2.5 O. a'! Industrial 15 1.20 2.5 1.00 0.5 Institutional 1S 2.24 2.5 0.50 0.5 Residential Is 2.20 2.5 0. a/ I/ Marginal labor cost assumed to be nil. Source: Mission estimates. Results of Lnalyses for Tavget Sectors Commercial Sector 5.7 The analysis for four representative applications is shown. Table 5.3 shows the economic rate of return for low range of economic fuel price (Table 5.1). The sensitivity of economic rate of return for various fuel prices and fuel price change rates is shown in Figure 5.1. This figure allows the quick estimation of economic rate of return given a fuel price. 5.8 The financial analysis for representative cases when no excise duty and sales taxes are considered is shown in Table 5.4. The same information is shown in Table 5.5 for the case when 25% excise duty is levied on components of SWH systems which are imported. 5.9 From Tables 5.3 to 5.5, it is seen that the rate of return is very low for projects saving fuel oil; similarly the NPM is negative for such cases. The projects saving electricity show very attractive rate of return. The financial analysis shows positive NPW for interest rates from 112 to 16X. - 22 - Table 5.3: ECONOMIC RATE Of RETURN FOR THE CO4MMERCIAL SECTOR APPLICATIONS -~~~ OF SWH SYSTEMS USINGi REPRESENTATIVE ECONOMIC PRICES Fuel Used Cost of First Collector for Water SWN Enorgy Year Fuel Economic Rate Application Area Hoeting System a/ Saved Savoing bl of Return (02) (USS) (TOE/yr) fUSS) (5) Pan Afrlque Hotel 130 Electricity 17,780 33.15 5,900 32 Mt, Kenya Safari Club 120 Fuel Oil 16,412 17.S8 2,257 10 Nyall Beach Hotel 240 Fuel Oil 35,703 38.7 4,969 12 DlploQst Cafoe 18 Electricity 2,603 5.5 919 39 a/ Foreign exchange premium of 20% has been applied to the cost component for Imported Items. b/ Value used reflects August 1986 economic prices (Table 5.1). Foreign exchange premium of 20% Is applied for petroleum products. Source: Mission calculations. Table 5.4: FINANCIAL ANALYSIS FOR THE COMMERCIAL SECTOR - HOTELS AND RESTAURANrS - BASED ON RETAIL FUEL PRICES AND NO DUTY AND SALES TAX ON SOLAR EqUIPPMENT Not Presont Worth at 25% Discount Rate Cost of First Yr Loan Interest Rate SUH Fuel '11 13% 16% Application System Savings Fuel Price Increase Fuel Price Increase Fuel Price Increase 0% 2.5% 0% 2.5% 0% 2.5% CUSS) (USS) Pan Afrique Hotel 16,380 5,846 14,230 17,452 13,215 16,438 11,618 14,841 Mt. Kenya Safari Club a/ 15,120 2,356 -1,535 -325 -2,471 -1,261 -3,946 -2,735 Nyall Beach Hotel 30,240 5,186 -784 a/ 1,910 -2,657 a/ 38 -5,605 a/ -2,910 Diplomat Cate 2,268 970 2,851 3,393 2,711 3,255 2,490 3,034 a/ Project not cost effective under the criteria considered. Source: Mission calculatlons. - 23 - Table 5.5: FINANCIAL ANALYSIS FOR THC COSOERCIAL SECTOR - HOTELS AND RESTAURANTS - BASED ON RETAIL FUEL PRICES AND * 25% ODUT AND NO SALES TAX ON SOLAR EQUIPMENT Net Present Worth at 25% Olscount Rate Cost of First Yr Loan Interest Rate SWN Fuel 13% 16 Application System Savings Fuel Price Increase Fuel Price Increase Fuel Prlee Increase 0% 2.5% 0% 2.5% 0% 2.5% (1USS) )USS) Pan Afrique Hotel 18,130 5,846 12,938 16,161 11,816 15,038 10,048 13,271 Mt. Kenya Safari Club S1 16,735 2,356 -2,727 -1,516 -3,763 -2,553 -5,394 -4,184 4yali Beach Hotel a/ 33,470 5,186 -3,167 -472 -5,240 -2,544 -8,503 -5,807 Dlplomat Cafe 2,510 970 2,673 3,217 2,511 3,062 2,273 2,817 a/ Project not cost effective under the criteria considered. Source: Mission calculations. Industrial Sector 5.10 The economic rate of return for low fuel price case for five representative systems given the low fuel prices prevailing in August 1986 is shown in Table 5.6. The projects to substitute fuel oil have very low rates of return. The sensitivity of IRI for a range of fuel prices is shown in Figure 5.2. 5.11 The financial analysis without and with 25% custom duty on SWH equipment is shown in Tables 5.7 and 5.8 respectively. All projects to substitute fuel oil are not cost difective under the criteria considered. The project to substitute gas oil shows very attractive performance. Table 5.6: ECONOMIC RATE OF RŁTUR FOR THE INDUSTRIAL SECTOR APPLICATIONS OF SWi SYSTEMS USING REPRESENTATIVE ECONOMIC PRICES Fuel Used Cost of Flrst Collector for Water 5SI Energy Year Fuel Economic Rate Application Area Heating System a/ Saved Saving b/ of Return (g2) (USS) (TOE/yr) (USS) (5) Kenya Brewery 360 Fuel Oil 49,237 40.7 5,225 6 ElIiotIs Baiery 378 Gas Oil 51,6S9 67.8 11.390 21 Oandora Creamery 324 Fuel Oil 44,313 54.9 1,048 13 Gulley's Tannery 900 Fuel Oil 123,093 123.6 15,868 9 Kenya Meat Comission 1,230 Fuei Oil 168,227 212.2 27,243 13 a/ Foreign exchange premium of 20% has been applied to the cost component for imported Items. b/ Value used reflects August 1986 economic prices (Table 5.1). Foreign exchange premium of 20% is appl ied. Source: Mission calculations. - 24 - Table 57: FINANCIAL ANALYSIS FOR THE INDUSTRIAL SECTOR - BASED ON RETAIL FUEL PRICES ANO NO DUTY AND SALES TAX ON SOLAR EQUIPMENT Not Present Worth at 25S Discount Rate Coat of First Yr Loan Interest Rate SII Fuel 11% 13S 16$ Application System Savings Fuel Price Increase Fuel Prico Increase Fuel Price Increase 0% 2.5% 0% 2.5% 0% 2.5% (USS) (USS) (USS) (USS) (USS) (USS) (USS) (JS S) Kenya Brewery a/ 45,360 4,396 -10,010 -7,709 -12,305 -10,005 -15,920 -13,620 Ellot's Bakery 47,626 24,611 8S,951 99,967 63,541 97,557 79,745 93,761 Dandore Creamery 40,824 5,929 511 3,726 -1,554 . 1,660 -4,808 a/ -1,593 a/ Builey's Tannery aX 113,400 13,348 -13,686 -6,573 -19,425 -12,312 -28,463 -21,350 Kenya Meat Com. 154,980 22,917 3,699 16,339 -3,944 a/ 8,495 -16,295 a/ -3,856 a/ I/ Project not cost effective under the criteria considered. Source: Mission coaculations. Table S.8: FINANCIAL ANALYSIS FOR THE INDUSTRIAL SECTOR - BASED ON RETAIL FUEL PRICES AND 25% DUTY AND NO SALES TAX ON SOLAR EqUIPMENT Not Presnt Worth at 25% Discount Rate Cost of Flrst Yr Loan Interest Rate SW" Fuel = 13% 16S Application System Savings Fuel Price increase Fuel Price Increase Fuel Pri ice Increase 0% 2.5$ 0% 2.5% 0% 2.5% (US1) CUSS) CUSS) CUSS) (USS) (USS) (USS) (USS) Kenya Broewry @1 50,206 4,396 -12,930 -10,630 -15,471 -13,171 -19,472 -17,172 Elliot's Bakery 52,716 24,611 82,884 96,900 80,216 94,232 76,614 90,03 Dandora Creamery 45,185 5,929 -2,117 q/ 1,097 -4.404 a/ -1,189 a/ -8,005 a/ -4,790 a/ Buley 's Tannery 1/ 125,514 13,348 -20,990 -13,876 -27,342 -20,229 -37,345 -30,232 Kenya Meat Com. 171,536 22,917 -6,062 a/ 6,357 -14,764 a/ -2,324 a/ -28,434 a/ -15,994 a/ I/ ProJect not cost effective under the criteria considered. Source: mission calculatIons. Public Sector 5.12 The economic rate of return for economic fuetl prices in August 1986 (Table 5.1) is shown in (Table 5.9) for few representative applications. The sensitivity analysis for the applications is shown in Figure 5.3. As expected the projects to substitute fuel oil show very low IRR, but that for the university dormitory, which saves gas oil, also shows low return because the fuel savings are realized for 9 months only. - 25 - 5.13 The financial analysis without and with 25 duty is shown in Tables 5.10 and 5.11 respectively. Most projects shown good performance for interest rate of 111 and 13Z. The projects saving fuel wood are not promising because the vetail price of wood is very low. Table 5.9: ECONOMIC RATE OF RETURN FOR THE INSTITUTIONAL SECTOR APPLICATIONS OF SWH SYSTEMS USINB REPRESENTATIVE ECONC#IC PRICES Fuel Used Cost of First Collector for Water SWH Energy Year Fuel Economic Rate Appilcation Area meat I ng System 8/ Saved Saving b/ of Return (p2) (USS) (TOE/yr) (USS) CS) Kenya Aospital 640 Fuel Oil 87,533 86.3 11,081 9 Health Center 86 Electricity 11,76. 21.9 3,898 33 Dispensary 14 Electricity 1,915 3.5 623 29 Univ. Dormitory 2,742 Gas Oil 375,023 397.4 66,763 15 Rural Dormitory 30 Wcod 4,103 8.1 380 <5 Health Center - Kerosene 86 Kerosene tt,762 50.3 11,649 >45 Dispensary - Kerosene 14 Kerosene 1,915 8.0 1,853 >45 a/ Foreign exchange premium of 20S has been appiled to the cost component for lported items, b/ Value used reflects August 1986 economic prices (Table 5.1). Foreign exchange premium of 20S Is applied for petroleum products. Source: Mission calculations. Table 5.10: FINANCIAL ANALYSIS FOR THE INSTITUTIONAL SECTOR - BASED ON RETAIL FUEL PRICES AND NO DUTY AND SALES TAX ON SOLAR EQUIlPMENT Net Present Worth at 25% Discount Rate Cost of First Yr Loan Interest Rate SWN Fuel 11% 13% 16% -: Application System Savings Fuel Price Increase Fuel Price Increase Fuel Price Increase 0% 2.5% 0% 2.5% 0% 2.5% CUSS) (CSS) tUSS) (USS) (USS) (USS) CUSS) (USS) 4 Kenyata Hospital a/ 80,640 11,564 -22,585 -16,707 -28,450 -22,572 -37,684 -31,806 Health Center-Elec. 10,836 3,862 8,355 10,485 7,589 9,718 6,381 8,511 Dispensary-Elec. 1,764 617 1,305 1,645 1,180 1,520 983 1,323 Univ. Dormitory 345,482 144,256 368,208 448,340 343,760 423,893 305,266 385,399 Rural Dormitory I/ 3,780 389 -1,707 -1,520 -1,975 -1,788 - 2,396 -2,209 Health Center - Kerosene 10,836 12,072 47,961 54,854 47,194 54,087 45,987 52,880 Otspensary - Kerosene 1,764 1,920 7,590 8,686 17466 8,562 7,269 8,365 a/ Project not cost effective under the criteria considered. Source: Mission calculations. - 26 - Table 5.11: FINANCIAL ANALYSIS FiR THE INSTITUTIONAL SECTOR - BASED ON iETAIL FtIEL PRICES AND 25% WTY AND NO SALES TAX ON SOLAR EQUIPMENT Not Present Worth at 25% Discount Rate Cost of First Yr Loan Interest Rate SW" Fuel 11$ 13% 16% Application System Savings Fuel Price Increase Fuel Price increase Fuel Price Increase 0% 2.5% 0% 2.5% 0% 2.5% (U) CUSS) CUSS) (USS) CUSS) (USS) WUSS) (USS) Kenyata Hospital a/ 89,254 11,564 -29,795 -23,917 -36,264 -30,386 -46,451 -40,574 Health Center-Elec. 11,994 3,862 7,413 9,542 6,567 8,696 5,235 7,364 Dlspensary-Elsc. 1,952 617 1,151 1,491 1,013 1,353 797 1,137 Univ. Dormitory 382,399 144,256 338,153 418,286 311,184 391,316 268,718 348,850 Rural Doolmtoey / 4,184 369 -2,036 -1,849 -2,331 -2,144 -2,795 -2,608 Health Center - Kerosene 11,994 12,072 47,018 53,911 46,172 53,065 44,840 51,733 Dispensary - Kerosene 1,952 1,920 7,437 8,533 7,299 8,395 7,082 8,178 a/ Project not cost effective under the criteria considered. Source Mission calculations. Residential Sector 5.14 The economic rate of return calculations for residential sector are shown in Table 3.12. Two estimates of economic costs of electricity supply to residential consumers are used for this analysis; a lower estimate of US$178/TOE, and a higher estimate of US$221.76/TOE. For both estimates, the rate of return is above 25%. Figure 5.4 shows the sensitivity analysis for economic IR and a range of electricity prices. 5.15 The financial analysis for houses without and with 25 duty on SWH equipment is shown in Table 5.13. Also shown in this is the analysis for cases when the value of electricity saved is considered using residential tariff A and D (interruptible supply). Table 5.12: ECONOMIC RATE OF iETURN FOR THE FiSIOENTIAL SECTOR APPLICATIONS OF SWi SYSTEMS USING REPitESENTATIVE ECONOMIC PRICES Fuel Used Cost of First Collector for Water SUH Energy Year Fuel Economic Rate Application Area Heating System a/ Saved Saving b/ of Return Cof) (USS) (TOE/yr) (CUSS) C% House 4 Electricity 547 1.035 184.00 b/ 33 House 4 Electricity 547 1.035 230.00 S/ 41 oa Foreign exchange premium of 20% has been applled to the cost component for Imported Items. b/ Value of electricity used is USS178/TOE (Table 5.1). cf Value of electricity used Is USS221.76/tOE. Source: Mission calculatlons. - 27 - Table 5.13: FINANCIAL ANALYSIS FOR RESIDENTIAL SECTOR - BASED ON RETAIL FUEL PRICES WITH AND WITHOUT 25S DUTY AND NO SALES TAX ON SOLAR EQUIIPIENT Net Present Worth at 25% Discount Rate Cost of First Yr Loan Interest Rate SWH Fuel 11S 13% 16% ApplIcation System Savings Fuel Price Increase Fuel Price Increase Fuel Price Increase OS 2.5S 0% 2.55 OS 2.5% (USS) (USS) (USS) (USS) (USS) (USS) (USS) (USS) House, Tariff A, No Duty 504 268 870 1 079 834 1,047 785 1,001 House, Tariff D No Duty S04 159 344 447 308 417 260 369 House, Tariff A With 23% Duty 558 268 825 1,043 794 1.009 736 956 House, Tariff D With 25% Duty 558 159 300 410 268 377 210 324 Source: Nission calculations. Sunmary 5.16 The economic rate of return for the representative SWH applications in cases involving the substitution of electricity and petroleum products, other than fuel oil, in each of the four economic sectors is above 15. Due to the extremely low price of fuel oil, the IRR for cases involving the substitution of fuel oil were found to be consistently below 10. 5.17 The financial analysis shows that several projects would be cost effective when financed for 10 years at interest rates of between 112 and 13X. The applications saving fuel oil are not cost effective under the criteria considered. However, the same projects may become marginally acceptable when the effect of local taxes is considered. The SWH applications designed to substitute wood fuels are not cost effective because of the artificially low price of wood. ..~~~~ease0o -28- LEGEND Fuel Price Increase - 51/Year.. Figure 5.1 Sensitivity of Economic Rate Puei Price Increase - O/Year of Return to Fuel Prices and Fuel Price Increase 4 51/_Year .._ Fuel Price Change Rate for Commercial Sector IS0 * 10 I I I IS Pan Afiique Hotel Fuel: Mt. lZenya Safari Club Fuel: Electricity Fuel Oil 100 100 50r< 501 so - so -~~~~~~~~~~~~~~~~ 0 100 200 200 400 500 0 100 200 300 400 500 ECO. PRICE OF FUEL SAVED ECO. PRICE OF FUEL SAVED 5O 150 Nyali Beach Hotel Fuel: Diplomat Cafe Fuel: Fuel Oil Electricity 100 100 .0~~~~~~~~~~4 .~~~ _ I I I I I I 0 100 200 300 400 500 0 100 200 300 400 500 ECO. PRICE OF FUEL SAVED ECO. PRICE OF FUEL SAVED -29 r1l Price Increase - 5x/Year Figure 5.2 Sensitivity of Econoiuic Rate *I. price Increase - OX/Year of Return to Fuel Prices and 1 price Increa" + SZ/ear_._. Fuel Price Change Rate for Itdustrial Sector Kenya Brewery Fuel: Elliot*s Bakery Fiel Fuel Oil Gas Oil 100 100 J so 50 0 100 200 300 400 500 0 100 200 300 400 500 ECO. PRICE OF FUEL SAVED ECO. PRVCE OF FUEL SAVED ;50 , I I Dandora Creamery Fuel.: Fuel Oil 100 ir so 4, 0 100 200 300 400 500 ECO. PRICE OF FUEL SAVED - 30 - LEGEND Fuel Price Incresse - 5UYear Puel Price Increase - 02/Year --'-in. Fuel Price Increase + 5/ Year _. _. 5.2 (Continued) 150 150 Bulley's Tannery Fuel: Kenya Meat Commission Fuel: Fuel Oil Fuel Oil 100 100 50 50 0 100 200 300 400 500 0 100 200 300 400 500 ECO. PRICE OF FUEL SAVED ECO. PRICE OF FUEL SAVED - 31 - LEGEND fuel Price Increase - 52/Year Yoel Price Increase - O/Year _ Figure 5.3 Sensitivity of Economic Rate Fuel Price Increase + 5%/Year _. _. of Return to Fuel Prices and Fuel Price Change Rate for Institutional Sector 150 I SO Kenyata Hospital Fuel: Health Center Fuel: Fuel Oil Electricity 100 100 4,.- 50 so0 I | ,,_ I I I _I _111. 0 100 200 300 400 500 0 Ico 200 300 400 500 ECO. PRICE OF FUEL SAVED ECO. PRICE OF FUEL SAVED I5S O - 150 . I I I Dispensary Fuel: University Fuel: Electricity Gas Oil 100 -4,1 100 so 50 -°L- 0 100 200 300 400 500 0 100 200 300 400 500 ECO. PRICE OF FUEL SAVED ECO. PRICE OF FUEL SAVED - 32 - LRGEND fuel Prlce Increase - 5Z/Year Fuel Price Increase - O/Year ........ Fuel Prlce Inexresse + 5S/Year _. _. - Figure 5.3 (Continued) 1SO 1SO Rural Dormitory Fuel: / Wood 100 - 100 I so . 50 - Health Center Fuel: -U--- . Kerosene 0 50 100 150 0 100 200 300 400 500 ECO. PICE OF FUEL SAVED ECO. PRICE OF FUEL SAVED ISO 100 _ _ Dispensary Fuel: Kerosene 0 100 200 300 400 500 ECO. PfICE OF FUEL SAVED -33- Pigure 5.4 Sensitivity of Economic Rate of Return to Fuel Prices and Fuel Price Change Rate for Residential Sector 150 Residence Fuel: Electricity 100 s O 100 200 300 400 500 ECO. PRICE OF FUEL SAVED LEGED Fuel Price Increase - 52/Year Fuel Price Increase - 01/Year _ Fuel Prlce Increase + 52/Year _. _. .~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ -34- VI. MARKET POTMTAL Introduction 6.1 The mission estimated the potential size of the SWH market in Kenya using a three-step approach. The first step was a broad-based survey of present users of hot water (Cha-pte I). Users were grouped into economic sectors (i.e., commercial, industrial, institutional, and residential), and each sector was then further divided into subgroups more representative of their typical hot water use. For example, textile mills and meat processing factories were divided into separate subgroups within the industrial sector; restaurants and hotels were considered separately under the commercial sector. The second step was to estimate market potential by translating the computer Aimulation results (Chapter III), market survey data, and information from GOK documents into estimates of market size. To accomplish this task, energy savings in typical systems within each market subgroup were estimated with the help of TRNSYS simulations. The number of energy users within each subgroup was estimated. The maximum potential energy savings was then derived by multiplying the energy savings per unit with the number of units in each subgroup. The third step was to eliminate potential applications of SWH systems which, although technically feasible, would not be economically attractive (i.e., greater than 15% IR) viable given petroleum product prices prevailing in August 1986. In this respect, almost all applications to substitute fuel oil were eliminated, since the economic rate of return was below the 15% cut-off level. Methodology for Estimating Market Potential 6.2 Two coefficients were defined to help translate the results of the market survey and the TRNSYS simulations into an evaluation of the technical market potential: (a) Collector Area Coefficient (CAC): This coefficient represents the typical amount of solar collector area needed to meet the hot water requirements of a specific type of application. This ratio was defined differently for different applications; for example, for hotels, the CAC was defined as the collector area required per bed. The use of this coefficient permits extrapolation to estimate the collector area requirements for the sites not analyzed by TRNSYS. (b) Energy Saving Coefficient (ESC): This coefficient is defined as the energy savings (in TOE) per unit (m 2) of solar collector area. The coefficient determines the energy savings achieved by SWH systems for a given application (e.g., a textile mill). This was the basis used to extrapolate the fuel savings and the - 35 - collector area requirements for particular installations not covered by TRNSYS. 6.3 By applying the two coefficients CAC and ESC, the total energy saved and the maximum collector area required in a given economic sector or subsector can be estimated, provided all potential users switched to SWH, systems. It should be emphasized that estimates of the maximum collector areas for Kenya were made by the mission based on today's flat plate collector technology .(to produce hot water with temperatures up to 95C). The actual market penetration will be dictated by a number of factors which include the prevailing economics, as well as the availability of credit, and incentives for customers and producers. 6.4 Tables 6 1-6.6 in this chapter provide estimates of the maximum collector sales (m ) and the maximum energy displaced (TOE/yr) as well as the economic market potential for various sectors given the prevailing economic prices of fuels/energy sources to be displaced by SWH systems. Additional information is provided in Annex 6. Estimates of Market Potential Market Potential of the Commercial Sector 6.5 The commercial sector consists of hotels and restaurants. The hotels in Kenya are rated from five to one star. Most non-rated hotels are sleeping places and, unlike large hotels, do not use any hot water in the guest bathrooms. Table 6.1: MARKET POTENTIAL IN THE COMMERCIAL SECTOR a/ Comuercial Technical Maximum Sector Collector Energy 1986 Application Area Saved Market Potential (TOE/yr) m2 (TOE/yr) Hotels 21,600 (4,280) 9,145 (2,454) Restaurants 68536 (28.062) 686536 (28.062) Total 90,136 (32,342) 77,681 (30,516) a/ Brackets used for equivalent fuel savings In TOE/yr. Source: Mission calculotlons. - 36 - 6.6 Hotels. In 1983, there were 25,224 hotel beds in the country, and 2,314 bes in various game lodges. 8/ The growth rate for the hotel industry was estimated to be 8% per year. Results from performwace analysis for hotels (para. 3.3 and 3.4) were used to determine the coefficient CAC (i.e., collector area per bed) for the hotels. Thus the maximum collector area was ea.timated at 21,600 i in 1986, which would result in a fuel savings of 4,280 TOE/year, mostly in electricity and fuel oil. 6.7 Restaurants. Based on the market survey (para. 1.8) and information from COK documents, the mission estimated the total number of restaurants in urban areas to be 4,690 in 1983. In rural areas, the total number of restaurants was estimated to be 4,422 in 1983. Using the results of TRNSYS simulations, the CAC was calculated (collector area per meal served per day). !hus, the maximum collector area in 1983 was determined to be 57,030 m'. Assuming a growth rate of 1% per year, the maximum coilector area for 1986 is found to be 68,536 m , which results in fuel savings of 28,062 TOE/year in the form of electricity, kerosene, wood, LPG and charcoal. 6.8 Total Market Potential for Commercial Sector. Table 6.1 shows that the total market poteftti#l for the commercial sector assuming August 1986 fuel prices, is 77,681/.' of collector area, resulting in savings of 30,516 TOE/year. The share due to restaurants would be more than 75%. Market Potential for Industrial Sector 6.9 Data on energy use in Kenyan indostries is available only for a few industries. 9/ Furthermore, since various industries are grouped together, it is not possible to isolate the- information for every industry type. Therefore, the mission used statistics on industrial out- put available from COK 10/, 11/ and results from the mission survey of the Kenyan industry to calculate CAC (collector area required per unit of industrial output) for different industries. The coefficient ESC for various industry groups were obtained from TRUSYS simulations (Chapter I$}). The industry groups selected for estimates of market potential were: (a) textile -- cloth and yarn; (b) animal feed; (c) rub- ber products; (d) chemicals; (e) paper and pulp; (f) soap; (g) miscel- 8/ Republic of Kenya, Statistical Abstract, 1984, Central Bureau of Statistics, Ministry of Finance and Planning. 9/ Energy Use in Kenya Industry-1983, Ministry of Energy and Regional Development. 10/ Republic of Kenya, Economic Survey-1985, Central Bureau of Statistics, Ministry of Finance and Planning. 11/ Kenya: Development Plan, 1984-1988, Ministry of Planning. - 37 - laneous food; (h) canning; (i) tobacco; (j) beverages; (k) bakeries; (1) meat; and (m) dairy. 6.10 Table 6.2 summarizes the estimates of maximum collector area and economic market potential for each of these subgroups in 1986. Whereas the maximum collector area for SWH systems in 1986 is estimated to be 153,605 mi (fuel savings of 21,812 TOE/year), extremely low price of fuel fil, translates into a very low economic market potential of only 22,880 m resulting in saving of 2,241 TOE/year. Table 6.2: MAFtKET POTENTIAL IN THE INDUSTRIAL SECTOR a/ Technical Maxlmum Industrial Industrial Collector Enwrgy 1986 Application Output/Year Unit Area Saved Market Potential (1983) > (TOE/yr) .2 (TOE/yr) Textile - Cloth 187,000,000 ,2 17,400 (3,006) - (-) Textile - Yarn 1,960 MT 1,120 (193) - C-) Animal Feed 154.000 MT 6,650 (615) - C-) Rubber Products 116,766 MT 7,800 (1,328) - (-) Chemicals 288,908 MT 8,91O (824) - -) Paper and Pulp 63,044 MT 2,140 (363) - --) soap 36,898 MT 670 (62) - X-) Misc, Food 1,733,000 MT 21,350 (1,976) 21,250 (1,970) Cooking OfI 10,000 MT 2,000 (240) - C-) Canning 43,232 MT 660 (86) - C-) Tobacco 6,000 MT 200 (24) - C-) Beverage 366,700,000 NT 750 (97) -) Bakery 180,621 MT 1,330 (265) 1,530 (265) Meat 186,430 MT 74,600 (12,516) - C-) Dairy 371,000,000 liters 1,28 t 211) - Total 153,605 (21,812) 22,880 (2,241) a/ Brackets used for equivalent fuel savings in TOE/yr. Source: Mission calculations. Market Potential for Institutional and Public Sectors 6.11 The institutional and public sector is divided into the fol- lowing subgroups: (a) hospitals; (b) health centers; (c) dispensaries; (d) boarding schools - including universities; (e) prisons; (f) army and police barracks. The information on subgroup (f) is not available; therefore its market potential was not estimated. The hot water system for most applications is for kitchens, but for dispensaries and health centers where the hot water is for process use; and for boarding schoc s where it is used for kitchens in some (mostly in the rural areas) and for both kitchens and bathrooms in others. Table 6.3 shows the mission's estimates of maximum collector areas and economic market ,potential for 1986. The maximum collectors area is found to be 174,156 e of collector - 38 - areal (over 55% of which is attributed to boarding schools) with an attendant fuel saving of 53,O95 TOE/yr, mostly in the form of fuel oil, electricity, kerosene and gas oil. Based on August 1986 fuel prices, t e economic market potential is slightly lower, at about 127,304 mi, resulting in fuel saving of 47,556 TOE/year. Table 6.3: MARKET POTENTIAL IN THE PUBLIC SECTOR a/ Units of Technical Maximum Pub lc Sector Public Sector Col lector Energy 1986 AppiIcation Activity Area Saved Market PotentIal M2 (TOE/yr) m2 (TOE/yr) Boerding Schools 279,945 b/ 96,646 (26,399) 63,399 (21,694) Hospitals 30,886 cl 28,522 (6,633) 14,917 (4,799) Health Centers 146,500 cl 25,866 (12,095) 25,866 (12,095) Dispensaries 318,250 c/ 20,368 (7,190) 20,368 (7,190) Prisons 26.508 d/ 2,754 (778) 2,754 (778) Tatai 174,156 (53,095) 127,304 (47,556) a/ Brackets use for energy saved is In the form of various fuels, the details of which are given in Annex 6. 6/ Number of boarders in schools In 1983. c/ Number of patients in 1984. A/ Number of prIsoners; SWH for kitchen use only. Source: mission calculations. Market Potential of Residential Sector 6.12 The residential market for SWH systems in Kenya is fairly large even though it is confined to upper and upper-middle class homes in urban areas and since these houses currently are electricity to heat hot water, the fuel displacement potential by SWH systems is high. The mission estimated that in 1982, 34,000 homes fell into this category. Based on the market survey (Chapter I) and information from GOK sources, the mission estimated both the primary and secondary market potential for SWH systems in the residential sector. The primary market consists of house- holds which can immediately switch over to SWH systems and thereby save electricity. This secondary market includes households which do not presently use electricity for water heating but would be likely to use SWH systems if the initial cost were low enough or financing were made available. Thus, the secondary market does not save energy in the present study. 6.13 In estimating the market pote2ntial for residences, three dif- ferent collector sizes (i.e., 6 m i 4 m and 2 m2) were considered. The difference in collector area was attributed to the lifestyles of different households and their use of various appliances. Also, the KPLC's electric water heating tariff structure was taken into con- -39- sideration. Under this structure, two different tariffs (A & D) are used for residential water heating. Tariff A is the regular domestic electric supply while tariff D is for interruptible supply (ripple control) which is supplied at a cheaper rate. Tariff D electric supply is used exclu- sively for water heaters. The hours when the supply would be available for ripple-controlled water heaters are not fixed; however, a minimum of eight hours of supply in. any 24-hour period is guaranteed by KPLC. Because of the unreliability (frequent breakdowns) of the ripple-con- trolled electric supply, along with the unpredictable hours of avail- ability, many households have installed water heaters on the regular, tariff A, supply. The market survey (Chapter I) indicated that house- holds on ripple-controlled water heaters strongly support the use of SWH systems if financing were made available or capital cost of SWH systems were reduced. 6.14 Table 6.4 in Kenya shows the mission's estimates of maximum collector area required for the primary residential market in Kenya. The economic market potential in 1986 is estimated to be 140,639 m2 of collector area, which results in a savings of 38,922 TOE/year (156 GVh/year) of electricity. Table 6.5 shows the corresponding estimates for the secondary housing market. In 1986, the economic market pot ntial and associated energy savings are estimated to be 108,338 m and 30,348 TOE/yr (122 GWh/yr), respectively. Cumulative Energy Savings in All Sectors 6.15 For 1986, the elonomic market potential for SWH systems in Kenya amounts to 368,508 m . (Table 6.6) corresponding to fuel savings of about 119,235 TOE/year. This estimate does not include the police and army barracks. Effect of SWH System Use on Electrical Energy Demand 6.16 Residential Sector. The results of the simulations for SWH systems (Chapter III) were used along with the simulation results for non-solar (electric) water heating systems to evaluate the utility interaction with SWH systems. The residential applications for SWH systems were considered in two cities - Nairobi and Mombasa. Annex 7 shows in tabular and graphical form the reduction in maximum demand for SWH system vis-a-vis non-solar (electric hot water systems). The reduction is significant and varies from about 40% to 95% for different months of the year and for different size houses in Nairobi and Mombasa. 6.17 The average reduction currently achievable in peak demand for the residential sector is 29.1 MW, considering the maximum market potential of SWH systems for residences, and 5.37 MW if 40% of the maximum market is penetrated. The availability of this extra capacity to - 40 - KPLC during all months will help KPLC better manage the distribution of electricity but does not significantly affect KPLC's decision to increase capacity. The maximum electricity saved in the residential sector by switching to SWH systems was calculated to be 156 GWh, which represents over 701 of the electrical energy savings achievable through SWH in all sectors. Table 6.4: MARKET POTENTIAL IN THE RESIDENTIAL SECTOR - PRIMARY MARKET 1986 Residential Number Market Potential a/ Sector of Houses Collector Energy Application Locatlon In 1982 Area Saved r TOE/yr Corporation Houses/ Nairobi 2.500 17,966 (4,849) Large I/ Corporstion Houses/ NaIrobi 2,500 11,978 (3,355) Houses on Electricity Tariffs a and 0 d/ 6 3rfs collector Nairobi 3,600 25,872 (6,983) - 4 2 collector Nairobi 8,400 40,245 (11,274) - 2 2 collector Nairobi 12,000 28,746 (8,052) All Houses/Tariff A only e/ - 2 m2 collector Nairobi 1,049 2,512 (704) Houses on Electricity Tariffs A and 0 f/ 6 m2 collector All 320 2,300 (621) - 4 collector Kenya 960 4,600 (1,288) 2 m2 collector Urban 1,920 4,600 (1,287) Areas All Houses/Tariff A Except only g/ Nairobl - 2 2 col lector 7 760 1,20 (509) Total 34,009 140,639 (38,922) a/ Rate of increase In grban housing Is 6.02% per year. b/ Large house with 6 o collector. cl Small house with 4,2 collector. dO Of the total number of houses, J5% are assumed large (6 m2 collector) 35% assumed medium (4 m' collector), and 50% assumed small (2 m colIector). e. Of the total number, 2% are assumed to use 2 m2 collector f/ Of the total number of houses, 10% are assumed large (6 w colectr)30% assumed med Ium (4 0 collector) 3 (2 eJ co I mf collector), and 60% assumed small (2 m collector).2 g/ Of the total number, 1% are assumed to use 2 ?2 collector. Source: Mission calculations, based on GOK/KPLC source documents. - 41 - Tabla 65: MARMET POTENTIAL IN THE RESIDENTIAL SECTOR - * SECONDARY MARKET 1986 Market Potential a/ Residential Number of Sector Houses Col lector Energy Appliction Location In 1982 Are Saved W (TOE/yr) Houses on Electricity Tariff A b - 2 m2 collector Nairobi 26,225 62,823 (17,598) Housr with Electricity Tariff A c/ All -2 M2 collector Kenya Except Nairobi 19,000 45.515 (12.750) Total 45,225 108,338 (30,348) a/ Rate of Increose of urban housing Is 6.02% per year. b/ Of the total number of houses, an additional 50% may eventually use S$H systems. c1 Of the total number of houses, an additional 25S may eventually use SWH systems. Source: Mission calculations. Table 6.6: SUH SYSTEMS: MAMET POTENTIAL FOR ALL SECTORS IN KENYA Technical Maximum Collector Energy Sector of Application Area Saved l986 Morket Potential a2 (TOE/yr) (TOE/yr) Commerclal 90,136 (32,342) 77,681 (30,515) Industrlal 153,605 (21,612) 22,880 ( 2,241) Public/institutional a/ 174,136 (53,095) 127,304 (47,556) Residential b/ 140.639 (38,922) 140,639 (38,922) Total 558,536 (146,171) 368,508 (119,235) a/ oZThe use of SUH systems for army and police barrocks Is not Included. b/ Primary market only. Source: Mission calculations, - 42 - 6.18 The ripple-controlled system used in residences in Kenya is antiquated, expensive, difficult to maintain, and is prone to long periods of breakdown. Also, the availability of hot water from the ripple-controlled water heaters is not predictable and often not available when needed. For these reasons, many homeowners with ripple- controlled water heaters have also installed additional water heaters on the regular tariff A supply. The cumulative effect is that ripple- controlled systems are not well accepted in Kenya; their sale since 1980, has increased at the rate of 1.11 per year compared with the total increase of electricity rate of 61 per year during the same period. 12/ The widespread use of SWH systems will allow KPLC to discontinue the use of ripple control and save the associated expenses of maintaining the system. The SWH systems are cost effective for the homeowners and GOK, even when compared with the existing off-peak (tariff D) electricity prices (Chapter VI). 6.19 Commercial Sector. The mission survey indicated that about 201 urban restaurants and about 601 small hotels use electricity to heat water while in larger hotels electricity is rarely used for hot water heating. The maximum saving in electricity in the commercial sector was calculated to be 18.3 CWh (restaurants: 12 GWh; small hotels: 6.3 GWh). The occurrence of peak demand is dependent on the use pattern which is variable. The impact of using SWH systems in the commercial sector on the overall demand reduction for KPLC would be negligible. 6.20 Institutional Sector. In this sector, water is electrically heated in a few educational institutions, hospitals, health centers and dispensaries. The maximum saving in electricity in this sector was cal- culated at 45.7 GWh. Although the saving is significant, its impact on KPLC's capacity reduction would be insignificant. 6.21 Induatrial Sector. The use of electricity for water heating in the industrial sector is negligible. The additional load imposed by SWH systems on the utility, primarily due to ancillary (i.e., electrical pump power use), would be very small and equal to or less than the parasitic electricity requirements of the existing water heating systems. Conse- quently, the interaction between the SW1 systems and the utility in the industrial sector would be negligible. 12/ KPLC, Annual Report and Accounts, 1984. - 43 - Annex 1 Page 1 of 2 TSNSYS SIMULATION v 1. The TRNSYS computer program examines the performance of a SWH system by. first examinining the performance of each major component 1/ and then by modeling their interactions. The program simulates the performance of a given system on an hour-by-hour basis over an entire year. The use of the TRNSYS is equivalent to writing a custom computer program for every individual solar energy configuration that is of interest. The details of TRNSYS simulation are given in Annex 1 and the Technical Supplements. 2. The simulation comprises a number of stages: (a) determining a hot water use Pattern for the particular application for the whole year; (b) identifying the generic SUH system which adequately meets the needs of this application; (c) developing hourly climatic data (solar radi- ation, ambient air temperature, relative humidity, wind speed and direction); 2/ (d) defining the technical specifications of various components (e.g., transmissivity, absorptivity, emissivity of collectors, $effectiveness' of heat exchangers; water pump characteristics, etc.); (e) choosing operational design variables (e.g., water flow rate through collectors, differential temperature setting to trigger the automatic start or shut-off option system, etc.) to operate the system; (f) speci- fying the cold water supply temperature for collectors on a year-round basis; (g) developing 'flow lines' (i.e., the logic for producing optimal designs for each specific application) which are to be custumzed for each application; and (h) actual simulation on the computer, which would use the 'flow lines' and simultaneously solve a system of algebraic and differential equations (a total of 17,520 sets for each simulation) to produce performance estimates. This simulation typically takes about 7 CPU minutes on a Prime 950 mainframe computer to produce program output. 3. The program output includef (a) the most economic SWH system to meet the water heating load of a particular application, and the optimal sizes of collector array storage tanks, and other subsystems; (b) temperature history of the system/subsystem on a half-hourly basis 1/ The major components of a typical SWH system include: (a) a solar collector; (b) an energy storage unit; (c) an auxiliary energy heater; (d) a pump; (e) several temperature sensing controllers; and (f) the piping and wiring necessary to link them all together. 2/ The required hourly data was available for various cities in Kenya for each variable except solar radiation, which is available only on a total global daily basis and/or hours of bright sunshnte. The hourly solar radiation data which is critical to successful estima- tion of the output of SWH systems was developed by the mission through the use of a customized computer progrim (Annex 1). ~ 44 - Annez1 Page 2 of 2 for the whole year, in particular, the collector and system-delivered hot water temperatures; (c) collector and system-delivered energy; and (d) detailed half-hourly performance of all subsystems for the whole year. Also, daily, monthly, and annual integrated values of various parameters are produced by the simulation. Annex 2 Page 1 of 5 CLIMATIC DATA OF KENYA 1. - In addition to its technical characteristics, the performance of a SWE system is- dictated by the climate in which it operates. The primary climatic variables which control the performance of a SWH system include solar radiation, ambient air temperature, relative humidity, wind speed (and- direction). A complex interaction between these variables continously changes the output of the SWI system not only from minute to minute on a given day but from day to day thzoughout the year. Addi- tionally, depending upon the terrain and the climate of the country, the system output can vary from place to place. 2. In order to correctly predict the output of a SWH system for the whole year at a given location, it is considered desirable to have access to hourly values of these climatic variables for the whole year. However, this is generally not available in a developing country and often indirect means have to be used to generate such data. Kenya, too, Is somewhat lacking in relevant climatic data. Whereas hourly values of temperatures, relative humidity and wind speeds (and direction) are available for several locations in the country, and data on solar radiation does not exist on an hourly basis. Instead, it is available in the form of daily total solar radiation in the horizontal plane and/or number of bright sunshine hours for a few locations in the country. In Tables 2.1-2.4 some representative climatic data is shown. The detailed climatic data is included in the Technical Supplement. Annex 2 Pag 2 of 5 Table 2.1: SOLAR RADIATIMAOURS OF SUNSHINE IN KENaA Daily Average Solar Radiation or Hours of Sunshine Annual Station Period Jan Feb gar Apr May Jun Jul Aug Sep Oct Nov Oec Average Eldoret bi 19S9-1967 9.3 8.7 8.3 7.6 7.8 7.5 5.6 S.7 7.6 7.6 7.6 8.6 7.? Equator 1939-1960 8.9 9.2 8.6 7.2 7.6 6.7 5.3 5.2 7.4 8.1 7.6 8.2 7.5 Garissa 1963-1980 500 505 513 S06 464 440 426 444 480 496 491 483 479 Kabete a7 1972-1980 540 560 519 459 394 356 326 353 459 503 452 488 451 Klsumu a/ 1967-1980 565 571 562 539 528 504 491 523 550 566 548 569 543 Kitale a/ 1966-1980 570 547 529 501 484 471. 454 470 527 524 507 565 512 Lamu a/ 1960-1980 483 478 493 463 420 416 428 474 520 518 513 499 475 Lodwar a/ 1966-1980 535 536 533 520 540 534 506 542 559 547 522 546 535 Makindu b/ 197I-1980 8.7 8.8 8.7 8.0 7.5 6.1 5.4 5.5 7.6 8.8 7.9 8.3 7.6 Matindi a 1967-1980 479 468 463 436 384 383 381 414 441 450 481 463 437 Manders 1967-1980 515 525 5C0 463 445 402 377 413 461 431 456 504 457 Marsabit a/ 1977-1980 510 525 514 465 S44 533 500 569 534 493 451 568 509 Meru a/ 1977-1979 379 432 429 384 382 365 315 366 431 426 361 335 384 Mombasa a/ 1963-1980 499 513 518 454 381 381 383 423 476 507 511 493 462 Nairobi a/ 1971-1980 504 512 498 430 390 341 321 344 424 464 440 479 429 Nakuru ad 1959-1963 7.9 8.4 7.2 6.0 6.7 7.9 7.5 6.9 7.2 6.3 5.5 7.5 7.11 Norok °7 1964-1980 535 523 534 473 436 408 387 424 489 513 477 507 476 Nyeri a/ 1976-1.980 379 419 406 341 363 323 244 278 376 397 327 362 351 Vo a/ 1964-1980 486 505 507 450 408 390 364 363 402 466 500 497 445 waiir bl 1974-1980 9.6 9.7 8.7 7.8 8.6 8.0 6.6 6.8 7.9 7.2 6.8 8.5 8.0 a/ Solar radiation Langleys. bt iHours of sunshine. Source: Kenya Meteorological Department, Climatological Statistics for Kenya, 1984. I . * Annex 2 Pape 3 of S Table 2.2: MONTHLY AVERAGE DRY ULB OTEWPERATURE FOR KENYA (C) Average Annual Station Period Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DOec Temwperature Eldoret 1959-67 16.7 17.1 17.8 17.9 17.1 15.8 15.6 15.6 16.1 16.8 16.8 16.4 16.6 Equator 1938-60 13.7 14.2 14.4 14.0 13.4 12.6 11.8 11.9. 12.7 13.1 13.2 13.0 13.1 Gartsso 1940-60 28.8 29.6 30.2 30.0 28.9 27.3 26.6 26.8 27.6 28.B 29.0 28.4 28.5 Kabete 1972-80 18.9 19.6 19.9 19.7 18.6 17.0 16.4 16.4 18.0 19.1 18.6 18.5 18.4 Kisumu 1931-80 23.8 24.0 24.0 23.3 22.7 22.1 21.9 22.1 22.8 23.6 23.6 23.4 23.1 Kitale 1966-80 18.6 19.4 19.5 19.3 18.6 17.7 17.3 17.4 17.7 18.1 17.9 18.0 18.3 Lamu 1960-80 27.7 28.0 28.8 28.3 26.7 25.8 25.3 25.3 25.9 26.9 27.7 27.9 27.0 Lodwar 1946-80 28.8 29.7 30.2 29.8 29.6 29.1 28.3 28.6 29.5 30.0 29.1 28.7 29.3 Nakindu 1937-80 23.1 24.2 24.6 24.0 22.6 21.0 20.1 20.5 21.8 23.3 23.2 22.7 22.6 Malindi 1962-80 27.0 27.2 27.8 27.6 26.1 25.2 24.6 24.5 25.0 25.9 26.6 27.1 26.2 Nandera 1936-80 28.8 29.9 31.0 29.8 29.1 28.6 27.9 28.1 28.9 28.8 28.1 28.3 28.9 Marsabit 1974-80 20.3 20.8 20.9 20.8 20.4 19.5 18.8 18.8 19.5 20.3 19.9 20.0 20.0 MNru 1975-80 17.4 18.3 19.3 19.2 18.2 17.0 16.7 17.0 18.3 19.3 17.9 17.3 18.0 tomnbasso 1946-80 27.6 27.9 28.4 27.6 26.0 24.8 24.0 24.1 24,8 25.8 26.8 27.4 26.3 Nairobi 1959-80 19.2 20.0 20.4 20.2 19.0 17.5 16.6 16.9 18.3 19.6 19.2 19.1 18.8 Nakuru 1957-62 17.2 17.4 18.0 17.6 17.5 16.3 16.2 16.3 16.1 16.S 16.5 16.7 16.9 Narok 1939-80 17.2 17.4 17.4 17.6 16.9 15.3 14.6 15.0 15.9 16.7 16.6 16.8 16.5 Nyorl 1976-80 17.5 18.3 18.8 19.0 18.3 16.8 15.9 16.2 17.8 18.8 17.7 17.4 17.7 Vol 1938-80 25.8 26.5 27.0 26.1 24.9 23.6 22.8 22.6 23.4 25.0 25.7 25.5 24.9 WaJIr 1936-80 28.7 29.4 29.9 28.9 28.0 27.0 26.3 26.5 27.2 27.9 27.6 28.0 27.9 Source: Kenya Meteorological Department, Cliuatological Statistics for Kenya. 1984. Annex 2 Page 4 of S Table 2.3: MONTHLY AVERAGE VEWPOINT TEWERATURE FOR KENYA (*C) Annual Average Relative Station Period Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Humidity Eldoret 195947 8.6 8.2 9.4 11.6 12.0 10.9 12.0 12.1 11.0 11.1 11.4 10.0 10.7 Equator 1938-60 5.3 4.5 5.6 8.2 8.8 8.5 9.2 9.4 7.8 7.4 7.8 7.0 7.4 6arissa 1940-00 19.2 19.4 20.0 20.9 19.8 17.8 16.9 16.7 17.1 18.1 20.2 20.5 18.9 Kabete 1972-60 12.0 11.8 11.1 13.1 13.9 12.8 11.8 11.6 10.6 12.2 12.9 13.0 12.2 Klsumu 1931-60 14.5 14.7 15.6 17.2 17.2 16.0 15.1 15.2 15.2 14.7 15.3 15.2 IS.5 KItale 1966-80 6.3 8.7 9.6 12.3 13.6 13.3 13.3. 13.2 12.5 12.3 11.9 9.2 11.5 Lamu 1960-60 22.4 22.4 235.3 24.1 23.5 22.1 21.3 21.0 21.4 21.4 23.0 22.9 22.5 Lodwar 1946-80 14.4 14.7 15.7 17.6 17.9 16.7 16.4 16.2 15.5 15.6 15.7 15.0 16.0 Nakindu 1937-80 15.8 1S.0 15.6 16.9 16.1 13.6 12.2 12.2 12.4 13.4 15.9 17.0 14.7 Nalindl 1962-80 22.6 22.6 23.2 23.5 22.9 21.4 21.0 20.8 20.9 21.8 23.0 23.1 22.5 1 Mandera 1936-80 15.9 16.1 17.8 20.6 20.0 17.7 16.' 16.1 16.8 19.5 19.5 17.6 17.9 O NarsabIt 1974-80 14.3 14.5 15.5 16.9 15.6 13.1 12.5 11.9 12.3 14.0 15.6 14.9 14.3 oe.u 1975-00 14.3 14.7 14.3 16.2 16.4 14.1 12.4 11.9 11.8 11.9 15.5 16.1 14.1 Mombassa 1946-00 22.3 22.3 23.0 23.1 22.5 20.4 20.0 20.6 20.2 21.3 22.? 22.8 21.8 Nairobi 1959-60 11.4 11.1 11.7 13.9 14.1 12.5 11.5 11.5 11.0 11.0 13.1 12.6 12.1 Nakuru 1957-62 9.1 8.1 9.7 12.6 12.9 11.6 11.2 11.6 10.9 11.2 12.0 11.0 11.0 Narok 1939-00 9.9 10.0 11.3 13.0 13.4 11.9 10.5 10.2 9.6 9.4 10.9 11.1 10.9 Nyerl 1976-80 12.9 12.7 13.1 14.6 14.7 13.5 12.6 12.2 11.4 11.9 13.9 14.3 13.2 Vol 1938-W0 17.6 16.9 17.5 18.7 17.4 14.8 13.6 13.9 14.6 1S.S 17.4 18.4 16.3 Wajlr 1936-00 17.7 18.1 19.1 20.5 19.8 18.0 17.0 16.8 17.4 18.0 19.6 19.3 18.5 Source: Kenya Meteorological Department, Climatological Statistics for Kenya, 1984. t . * . . . A * Annex 2 Page 5 ot 5 Table 2.4: MONMhLY AVERAGE WIND SPEED FOR KENWA tKNOTS) Annual Averae Station Perlod Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Temperature Eldoret 1959-7 6 6 7 5 6 6 5 6 7 7 6 6 6 Equator 1939-59 1S 16 17 IS 14 12 10 9 11 13 16 16 14 6arlssa 1941-M0 6 6 5 6 9 10 It 11 10 9 5 5 8 Kabete - - Klsumu 1939-80 12 12 11 10 8 8 8 10 10 to 10 to 10 KItale 1966-0 7 7 7 6 6 6 6 6 7 6 6 6 6 Lasu 1960-80 13 12 10 10 11 12 12 11 it 10 9 to 11 Lodwar 1946-80 11 12 12 10 9 9 9 9 9 11 11 It t0 Maklndu 1938-00 8 9 9 8 9 8 0 9 10 tl 8 8 9 MalIndI 1962-80 13 14 13 12 12 13 13 11 11 11 10 12 12 Mandera 1937-40 7 6 6 9 12 12 12 10 6 5 7 0 Marsabit 1974-80 10 11 12 9 10 10 1 1 1 11 1 1 9 11 11 Neru 1975-80 a 8 8 a 9 10 11 to 1l 9 7 7 9 Nombassa 1946-80 12 13 12 12 13 13 13 13 13 12 12 11 12 Nairobi 1959-80 12 12 13 11 8 7 6 7 8 10 11 13 10 Nakuru 1957-62 11 12 11 8 10 9 10 9 10 9 7 11 10 *Narok 1939-80 9 10 10 10 9 8 9 9 9 tO 9 9 9 Nyeri 1976-B0 9 10 10 10 9 8 9 9 10 10 8 8 9 Vol 1938-80 8 9 7 8 9 10 11 11 11 9 8 7 9 WaJir 1936-80 7 7 6 7 8 10 11 10 9 7 7 7 8 Source: Kenya Meteorological Department, Climatological Statistics for Kenya, 1984. -5- Annex 3 Page 1 of 8 PRINCIPAL TYPES OF 81H SYSTEMS 1. Depending on the intended end-use (i.e., whether the system would be used to meet preheat or process heat requirements in an indr-- or hot water needs in a hotel or a restaurant), a 8WH system can different forms. For this report five different SW systems studied, each of which is made up of different components and cQ - quently has different and economic performance characteristics. For developing computer simulations for various applications in the industries, homes, hospitals, hotels, restaurants, etc. system was used. The five systems are descyibed below: (a) SW system with water storage tank and collector loop heat exchanger: This system, which is schematically shown in Figure 3.1 is suited for applications such as hospitals and first class hotels. In this system, the fluid in the collector loop never comes in contact with the potable water. This is avoided usually by using an antifreeze mixture (such as pro- pylene or ethylene glycol) in the collector loop. The anti- freeze solution removes heat from the solar collectors and transfers it through the heat exchanger to the potable water. Since ethylene glycol is toxic, its use typically requires the heat exchanger to be double walled. However, with propylene glycol single wall heat exchangers can be used. In Kenya, there are no instances of freezing temperatures; therefore, antifreeze solution in the collector loop can be dispensed with, except for applications (e.g., first class hotels) where the collector fluid must be kept separate from the potable water. Two temperature sensors -- one near the bottom of the storage tank and one in the solar collector plate -- are used to signal the differential temperature controller, which can automatically start or stop the SWH system. In Figure 4.1 when S1-S2>6.6'C, the controller starts the pumps and solar energy collection starts. When S1-S2<2"C then the pumps stop. The water in the storage tank can attain quite a high temperature; a tempering valve V has to be used in the outlet of the tank. The purpose of this valve is to mix cold water with the hot water existing from the tank if its temperature exceeds 60°C (or any other set temperature). Thus, the hot water sent to the load is always at the prespecified temperature. (b) SWH system with water storage tank and no collector loop heat exchanger: Such systems are typically used in non-freezing climates in non-critical applications (houses, public build- ings, small roadside cafes, restaurants, etc.). Figure 3.2 shows the schematic for such a system. In this system only one pump is used and the potable water circulates through the solar collectors; and, since no penalty is imposed on this system by the heat losses in the heat exchanger, its efficiency is higher than system (a) above. The parasitic electric power use, i.e., -51- Annex 3 Page 2 of 8 electrical power consumed by the pumps, etc., is also less. Depending upon the application, the hot water outlet for this type of system may or may not have a tempering valve. For example, in applications such as household bathroom use, the tempering valve must be used, whereas for kitchen hot water use, where the temperature of water needs to be as high as possible, no tempering valve is needed. The controller in this system performs in the same manner as in the system with the collector loop heat exchanger. (c) SiH system with no water storage tank or heat exchanger: The system, shown schematically in Fig. 3.3, is the simplest because it does not Include any storage tank .-r heat exchanger; it is best suited for industrial water heati A. Because of its simplicity, this system is generally cheaper than (a) or (b) above. In this system, the process water is sent directly through the collectors and heated to whatever temperature the collectors are capable of, depending upon the type of solar collector, its fluid flow rate, incident solar radiation, and the ambient temperature. In this application, a number of solar collectors are used in series to attain an acceptable temperature difference across the collector. The collector pump and the three-way valve V1 are operated by a differential temperature controller. The controller senses temperature S1 at the collector plate and S of the supply water under predefined conditions to start the pump and the valve VI from position 'a' to 'b'. At the end of the day or whenever there is no sun, the controller shuts the pump off and the three-way valve opens from position 'c' to 'b'. (d) In this type of system no pumps or pump controllers are required. Basically, this system is similar to solar water heating systems with storage and no heat exchanger. This type of system is suited for use in non-freezing climates. In areas where electricity is not available, these systems can be used. Thermosyphon SWH systems are suita,le for small systems typically in the range of 2 W to 10 m of collector area. Figure 3.4 shows the schematic for such a system. An important requirement for this type of SiH system is that the storage tank be located above the top of the collector. This is necessary to prevent the reverse flow of hot water from the storage tank to the collector at night. The detailed analysis of thermosyphon systems performed by Huang 1/ suggests that the thermal performance of a well designed small thermosyphon system can be very similar to that of a system with pumps and temperature controller. The performance of a thermosyphon 11 B.J. Huang, Similarity Theory of Solar Water Heater with Natural Circulation, Solar Energy Journal, Vol. 25, pp. 105-116. -52- Annex 3 Page 3 of 8 water heater using a heat exchanger immersed in the storage tank has been analyzed by LBL 2/ who has determined their performance under certain conditions to be similar to the pumped SWH systems with heat exchangers. However, the modeling of thermaosyphoning SWH systems is very complicated and most large computer simulation codes are now beginning to analyze the hourly performance of thermosyphon systems. In this study the small SWH applications that have been analyzed with the TRNSYS progeam can be used to represent thermosyphon systems within practical limits as determined by references 1/ and 2/. (e) Retrofitting SWH System to Existing Electric Water Heater., The solar water heater in a retrofit situation is connected in a series with the existing electric water heater. The cold water inlet of the existing water heater is connected to the outlet from the solar storage tank. In this arrangement, the existing water heater serves as a back-up heating system. Figure 3.5 shows a suggested method of retrofitting a SWH system to a house. If the system is to be used for bathrooms, then a tempering valve should be used in the outlet of the solar water storage tank. 2/ A. Mertol, et al., Detailed Loop Model (DLI) Analysis of Liquid Solar Thermosyphons with Heat Exchangers, Lawrence Berkeley Laboratory Report No. LBL-10699, June 1981. -53- Annex 3 Page 4 of 8 FIGRE 3.1 - SOLAR WATER HEATING SYSTEM WITH WATER STORAGE AND COLLECTOR LOOP HEAT EXCHANGER Heat Vent Exchanger Cold On When Tc is 100F C above T W - 54 - Anex 3 Page 5 of 8 FIGUIE 3.2 - SOLAR WATER HEATING SYSTEM WITH WATER STORAGE AND NO COLLECTOR LOOP HET EXCHANGER CHECK VALVE PUMP CL AE SUPL - 55- Amex 3 TIGURE 3.3 - SOAR WATER UATIkG SYSTEM WTh WATE STOR Page 6 of 8 AND NO COLLECTOR LOOP BEAT EXCHAGER I I"uw I /~~~~~~~~~~O#a TRlEATED WITER SLIER MAKEUP WATERa NT T - 56 - Page 7 of 8 FIGURE 3.4 - SOLAR WATER HEING SYSTEK OF THERMOSYPON TYPE IEQUIRING NO PUSM. in4~U HOT WARM ~ICOLD COLLECTORS COLD IC -57- Page 8 of 8 FIGURE 3.5 - SOLAR WATER HEATING SYSTEK WITH WATER STORAGE AND NO COLLECTOR LOOP HEAT EXCHAGER, FOR USE WITH EXISTING ELECTRIC WATER HEATERS IN ltUSES EXISTING HOT WATER HEATER TO LOAD STORAGE ELECTRIC / iONTi ~~~~~~TANK l_.HEATER CHECK VALVE PUMP COLD WATER SUPPLY l - 58 - AnAne 4 Page 1of 2 SELECTION OF THE SOLAR COLLECTOR FOR SIMULATIONS AND PRODUCTION IN KNA 1. Three different generic typew of solar collectors were investigated through simulations. These are: Type A: Very good collector, single glass selective surface, extra insulation. Collector parameters FR Ta 0.82 Fa UL z 17.756 KJ/(hr. mu.0C) Type B: Cood collector, single glass selective surface. Collector parameters pa UL to 0.82 FR UL a 23.452 KJ/(hr. m . C) Type C: Poor coLlector, single glass, non-selective (flat-black surface. Collector parameters Fa Tr 3 0.82 FR lL u 31.879 KJI(hr. m2.0C) The non-linear performance equations for the three types of collectors are: Type A: n a 0.82 - 2.8 A - 0.016 (AT) I 12 Type B: n a 0.82 - 4.4 7-AT 0.021 (AT) I ~~~I Type C: n = 0.82 - 7.1 AT _ 0.021 LAdT2 Where AT Tfi a T a fluid inlet temperature to the solar collector fi T * ambient temperature a n a efficiency I a solar radiation incident on the collector. - 59 - Annex 4 fage2of 2 ADVANTAGES OF TYPE A COLLECTOR (a) It is apparently the most cost-effective type. (b) Over 90X of the collector production takes place in the industrialized countries where Type A is fast becoming the most comonly produced colector with readily available components. Since the collector production plans for Kenya call for an assembly of imported components from industrialized countries (Chapter VII), the production of Type A will have the best chance of ensuring constant supply of components. (c) The collector can satisfy all water temperature needs ranging from as low as 60'C to as high as 95"C. This will eliminate the need to produce a variety of collectors for different applications (households, hotels, industries, etc.,) in Kenya, which, in turn, will simplify production and quality control. (d) Being more or less a state-of-the-art collector, Type A will be easier to adapt to new developments in the SWH technology in coming years. This will help maintain the technical and economic edge of the SIH technology in Senya. (e) The number of 'collector-years' of actual experience is by far the highest with Type A collectors and covers a variety of climates. These collectors have performed with a high degree of reliability, and manufacturers are now routinely providing them with warranties of five years (and in a few cases, even ten years). Therefore, the prospects of che coLlector performing reliably over more than 15 years under actual operating conditions in Kenya are best with Type A. - 60 - AnneK 5 Page I of 9 PEFWOANCE ANALYSIS RESULTS - RFRESENTATIVE CALCULATIONS FOR VARIOUS SECTORS AND APPLICATIONS Table 5,1: DATA FOR COMMRCIAL SECTOR APPLICATIONS OF SOLAR WATER HEATING SYSTEMS Units of Fuel Used For Cokmercalo Sector CogmercalI Activity Water I4eatIng Location Pan Afrique Hotel 200 beds Electricity Nairobi Mount Kenya Safari Club 140 suites Furnace oll Nairobi Nyal I each Hotel 350 beds Furnace o*l Mbobasa SlIver Beach Hotel 180 beds Electricity Mmbasa Diplomat Cafe 400 meals/day Electricity Nairobi Cafe - 300 meals/day Electriclty Mombasa Rural Restaurant 50 meals/day Charcoal Nairobi Rural Restaurant 50 meals/day Wood Momasa Source: mission collected informetion. Tablo 5.2: RESULTS OF PEFORSANCE ANALYSIS FOR THE C-EYMRCIAL SECTOR Useful Average Hot Water Size of Solar Energy Solar Energy Efficiency Commercalo Used Collector Saved Delivered of Solar Application LocatJon Per Day Array Per Year to the Load Collector (liters) (02) (TOE) (GJ) WS) Pon Afrique Hotel Nairobi 12,000 130 33.15 a/ 481 58.5 Mount Kenya Safari Club Mombasa 10,500 120 19.7 b/ 494 S6.0 Nyall Beach Hotel Mombasa 21,000 240 38.7t 965 55.0 Silver Beach Hotel Nombasa 10,600 120 31.7 461 55.2 Diplmant Cafe Nairobi 1,600 16 5.5 80 61.2 Cafe Nombasa 1,200 12 4.0" 59 64.1 Rural Restaurant Nairobi 38 2 0.5 / 5 35.9 Rural Restaurant. Mombasa 38 2 0.5 t/ 6 46.6 a/ Efficiency of fuel use Is 100%. b/ Efficlency of fuel use Is taken as 55% at the hotel occupancy of about 45%. The low efficlency Is due to the boilers being grossly ovesizd for awvrage occupancy. c, Fuel use off Iclency for heating with wood or charccal ovee open flame Is about 12%. Note: The hotels' seving shown Is for 100% occupancy. Source: Mission colculatlons. - 61 - Annex 5 Page 2 of 9 Table 5.3: SNH SYSTEM PERFCRANAE: NAIfO3I MOUNT KENYA SAFARI CLU3 a/ Hours of * icolector Pup Tank Opwation Loss Energy Saved OHrs) (GJ) (Gi) (TOE) Jan 295 8.170 278.8 10.26 Feb 265 7.418 246.9 8.70 mar 288 7.365 213.5 7.69 Apr 274 6.714 175.5 6.23 May 278 7.333 187.5 6.64 Jun 269 7.264 170.7 6.03 Jul 272 7.169 140.7 4.98 AUg 277 7.120 153.7 5.43 Sep 272 7.440 147.3 6.99 Oct 281 7.712 213.9 8.10 Nv 27 m 7I088 203.7 7.24 DeC 260 7.341 214.0 7.95 /001 lector area .640 W. Source: Mission calculations. Table 5.4: SWH SYSTEM PEIWORANCE: MOMBASA NWALI EAOCH CLUB a/ Hours of coelector Puup Tank Operatlon Loss Energy Saved (Hrs) (GJ) (GJ) (TOE) Jan 309 9.824 43.07 1.88 Feb 280 0.731 36.27 1.79 Mar 300 0.816 36.41 1.85 Apr 227 0.820 35.80 1.76 MOY 308 0.813 32.60 1.82 Jun 297 0.775 30.84 1.54 Jul 303 0.767 26.54 1.46 Aug 308 0.837 35.10 1.93 Sep 295 0.825 36.54 1.80 Oct 304 0.834 40.52 1.89 Nov 299 0.795 38.17 1.77 DOec 307 0.799 36.00 1.87 /ColIlector areaW 86 z2. Sorces: Mission calculatlons. - 62 - Annex 5 Popg 3 of 9 Table 5.5: SH SYSTEM PERfO4ANCE: NAIROBI ELLIOT'S BAKERY / Number of Hours the Solar Do0llector Outlet Temp_erture Is In the Rang 20*C-50C .50-C-80*C 80*C-1O0C Energy Saved (Hrs) (Hrs) WHr.) (0W) (TOE) Jan 496 88 160 232 7.76 Feb 450 94 128 202 6.74 Mar 524 152 68 179 6.00 Apr 494 145 41 147 4.93 May 543 155 46 157 5.25 Jun 530 175 15 147 4.89 Jul 628 109 7 120 4.00 Aug 601 143 0 131 4.39 Sep 520 154 46 167 5.58 Oct 517 134 93 190 6.37 Nov 510 151 59 171 5.71 DOec 514 158 71 187 6.24 a/ Collector area 378 Source: Mission calculations. Table 5.6: SWH SYSTEM PERF0RKANCE: NAIROBI HEALTH CENTER a/ Hours of 00Clector PuMp Tank Operation Loss Energy Saved b/ (Hr') (J) (J) (TOE) Jan 286 0.137 8.23 0.39 Feb 262 0.124 7.21 0.34 Mar 280 0.099 6.56 0.31 Apr 270 0.072 5.27 0.25 May 276 0.086 5.71 0.27 Jun 268 0.079 5.21 0.24 Jul 270 0.058 4.34 0.21 Aug 275 0.058 4.79 0.23 Sap 269 0.090 5.97 0.28 Oct 280 0.107 6.83 0.33 NoV 271 0.090 6.14 0.29 DOec 279 0.104 6.71 0.32 a/ Collector area a 14 *2; schedule of operation Is 5 days per I'S Electrlilty Is the fuel displaced, the efficlency of fuel use Is 100%. Source: Misslon calculations. - 63 - Annex 5 Paog 4 of 9 Table 5.7: DATA FCR INDUMSRIAL APPLICATIONS OF SWH SYSTEMS Units of Fuel Used Schedule Industrial for Water of Industry Product Activity Heating Operation Location Oil Extraction, Ltd, Cooking 011 7 T/day oil Furnace 3 shifts/day Nairobi 45/day oil 200 days/year animal I -d Kenya Breweries Beer 191 mililon Furnace 2 shifts/day Nairobi lIters/year oil 290 days/year Kenya Connerles Canned Fruit 4.3 million Furnace 2 shifts/day Thika cases/year oil 280 days/year Elliots' Bakery Breoad 270,000 Gas oil 3 shifts/day Nairobi loaves/day 365 days/year Dandore Creamery Milk 0.3 million Furnace 3 shifts/day Nairobi liters/day oil 365 days/year Kenya Meat Corn. Meat 4,586 T/year Furnace 2 shifts/day Nairobi oil 360 days/year BAT Kecya Tobacco 4,949 T/year Furnace 2 shifts/day Nairobi oil 251 days/year Firestone Tires 19 million Furnace 3 shifts/day Nairobi pounds/year oil 360 days/year Kenya Paper Mill Paper 5,200 T/year Furnace 3 shifts/day Nairobi oil 360 days/year Salley's Tannery Leather 1.6 millIon Furnace 2 shifts/day Thika sq. ft./year oil 290 days/year Thika Cloth Mill Cloth 12 mllilon Furnace 3 shifts/day Thika sq. r/year oil 365 days/year Kenya Neat Con. Neat N.A. Furnace 3 shifts/day Mombasa oil 365 days/year E.A, Brewery Beer 240 millIon Furnace 3 shifts/day Mombasa lIters/year oll 290 days/year Guisham Bakery Bakery N.A. Gas oil 2 shifts/day Mombasa 365 days/year Source: Mission collected Information. Annex S Poa 5 of 9 Table 5.8: RESULTS OF PERFORMANM ANALYSIS FOR INDWSTRIES Maximu Performance a/ Actual Performance bJ Slze of Useful Average Useful Hot Water Solar Energy Solar Energy Efficiency Solar Energy Used Collector Saved DOlivered to of Solar Delivered Industry Location Per Hour Array Per Year b the Load Collector to the Load (liters) (m2) (TOE) (GJ) (%) (0.3) Oil Extraction, Ltd. Nairobi 2,000 324 S5.8 1,782 67.1 976 Kenya Breweries Nairobi 2,0o0 360 56.1 1,923 65.2 1,527 Kenya Canneries Nalrobi 3,700 S56 96.2 3,125 68.3 2,397 Elliot's Bakery Nairobi 2,500 378 67.5 2,115 68.3 2.115 Dandora Creamery Nairobi 2,000 324 54.8 1,782 67.1 1,782 Kenya Meat Con. Nalrobi 10,000 1,600 272.1 8,630 67.3 8,708 BAT Kenya Nairobi 1,000 150 25.9 841 68.4 578 Firestone Nairobi 5,500 828 142.9 4,638 68.3 4,575 Kenya Paper Will Nairobi 1,400 210 36.1 1,177 68.4 1,161 Sulley's Tannery Thika 6,000 900 155.4 5,046 68.4 4,008 Thika Cloth Will Thika 7,000 1,050 181.3 5,887 68.4 5867 Kenya Meat Comn. Mombasa 8,200 1,230 212.1 6,887 67.0 6,887 E.A. Brewery Mombasa 2,400 360 62.0 2,016 67.0 1,601 Guishan Bakery Mombasa 1,000 150 25.6 840 67.0 840 a/ This Is the energy delivered to the load and represents the maximum amount possible. The effects of plant closing and factory shut-downs are not Included. b/ This Is the actual performance expected, based on the operating schedule of the factory. c/ Conversion factors are given In the beginning of this report. The boiler efficiency Is assumed as 70% for all Industries. This represent actual amount o# energy served. Source: Mission calculations. , 4 - 65 - Annex S Poge 6 of 9 Table 5.9: DATA FOR INSTITUTIONS AND OTHER PUBLIC SECTOR APPLICATION OF SWH SYSTEM Units of Fuel Used Public Sector Institutional for Vater Appicoation Location Activity Hes+;ng Porlod of Use Meter Hospital Nairobi 00 beds a/ Furnace oil All-year Kenyata Hospital Nairobi 700 beds -/ Furnace oil All-year Aga Khan Hospital Nairobi 220 beds °/ Furnace ofl All-year 200 outpatients DI spnsary 2 Shifts Nairobi 60 patients/day Electricity 5 days/week Health Center 1 Shift Nairobi 50 patients/day Electricity 5 days/week Dispensory I Nairobi 250 poatients/day Electricity 5 days/weok HOIth Center 1 Shift Mombasa 500 patlents/day Electricity S days/week Dispensary Mambos" 250 patients/day Electricity 5 days/week Health Center 1 Shlft Rural Area 500 patients/day Kerosene 5 days/week Dlsponsary Rural Arnas 250 patients/day Kerosene S days/week University of I Nairobi Doru Nolrobl 6000 students 0 Gas oil Sept. to June School Dormltory Mombasa 300 students ° Gas oil Sept. to June Schooi Dormitory Rural 300 students W/ Wood/ Sept. to June Areoas Charcoal a/ Hot water for kitchen and bathrooms. +/ Hbt water for kitchen only. Source: Misslon Calculations. 4~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~. - 66 - Annex 5 Pag 7 of 9 Table 5 R10: ESULTS OF PERFWAPNCE ANLYSIS FOR INSTITUTIONS AND PUBLIC SECTOR APPLICATICNS OF SIH SYSTEMS Slzo of Useful Average Hot Vater Solar Energy Solar Energy EffIcInacy Public Sector Usod Collector Saved DelIvered of Solar Application Location Per Day Array Por Year to the Load Collector (liters) (2) (TOE) (GJ) (5) Meter Hospital NalrobI 24,000 274 36.9 a/ 1,003 58.5 Kenyata Hospital Nairobi 56,000 640 66.3 / 2,346 58.6 Aga Khan Hospital Nairobi 19,800 226 30.4 a826 58.5 Dispensary 2 Shifts Nairobi 300 4 0.8 18 64.8 Health Center I Shift Nairobi 7,500 86 21.9 bi 448 68.3 Dispensary Nairobi .1,2S0 14 3.5 1' 72 58.6 HvA Ith Center I Shift Mawb"sa 7,500 86 21.3 i 435 65.8 Dispensary Mombaso 1,250 14 373 0 TO 66.3 Health Center I shift Rural Areas 7,500 86 50.3 / 456 68.3 Dispensary Rural Area 1,250 14 8.0 -i 73 68.6 University of / Nairobi Doran Z Nairobi 24,000 2,742 397.4 3 10,355 60.1 School ormitorY ; Mombasa 9,000 100 13.3 Z 348 57.6 School Dormitory Z Rural Areas 2,700 30 8.1 111 59.9 a/ Efficiency of fuel use Is assumed as 60S yearly average. b/ Electricity is the fuel, therefore, efficiency of use Is 100%. ci' Open flao used for water hoeting, efficiency of fuel use Is 15% for Kerosene fuel. di For seasonal use only (October to HMy). Source: MIsslon calculations. ..~~~~~~~~~~ - 67 - Annex 5 Poge B of 9 Table 5.11: PERWoRANCE EVMAWTION RESULTS OF SOLAR WATER HEATING SYSTEMS FOR THE RESIMENTIAL SECTOR Nuober of Fuel Used Hot Woter Slze Solar Residentlal Poople In for Waler Used Collector Application Location the House Heating Per Day Aray Energy Saved (ilters) (a2) (TOE) (KUHR) Large House Nairobi 6 Electricity 450 6 1.6 6,530 Small House Nairobi a Electricity 360 4 1.0 4,518 Large House Mombaso 6 Electrclity 450 6 1.5 5,973 Small House Mosmbsa a Electricity 360 4 0.9 4,025 Sources mission Calculations. Table 5.12: CETAILED IWORATION FOR RESIOENTIAL SECTOR APPLICATIONS OF SUN SYSTES Useful Solar Useful Enery Residentlal Energy Delivered Energy Collected Average Efficiency Application Locatln to the Lod by the Collector of the Collector (Gil) (GJl) CS) Large House Nairobi 23.4 26.7 55.6 Small House Nairobi 16,2 18.6 57.9 Large House Mombasa 21.5 24.8 53.9 Small House Mombasa 14.5 17.1 55.7 Source: Mission calculatlons. -68 A9nte 9 paoe 9 Of 9 Table 5.13: SWU SYM PEaOIAM0: - UAIIOSI SMALL MS Hours of Ool lester PiMP Tank Enegy Saved operatin LOss (qJ) (TOE) (NWS) () Jan 2.10 0.14 309 0.153 Fab 1.79 0.12 278 0.139 Mar 1.49 0.09 298 0.139 Apr 1.16 0.07 282 0.129 MaY 1.23 0.08 294 0.140 Jun 1.12 0.07 283 0.139 Jul 0.87 0.06 274 0,137 A"g 0.97 0.06 284 0.137 SOP 1.33 0.08 285 0.142 Oct 1.58 0.10 303 0.140 NOV 1.39 0.09 287 0.136 ODe 1.54 0.10 297 0.144 a l lector area 4 . S/ Electricity Is the fuel displaced, tho efficienty of fuel us ts 100%. Source: Mission Calculatlons. Table 5.14: SWH SYSTEM PERFORMIA: MOMBASA SMALL HOSE / .ours of Col Iector Puep Tank Energy Saved Operation LOss (6J) (TOE) (IHrs) (6IJ Jon 1.54 0.10 305 0.1! Feb 1.29 0.08 276 0.137 Ibr 1.27 0.08 297 0.154 Apr 1.25 0.08 298 0.154 Ma 1.09 0,07 301 0.154 Jun 1.03 0.07 291 0,147 Jul 0.84 0.06 287 0.149 Aug 1.20 0.08 308 0.158 Sep 1.23 0.08 298 0.136 Oct 1.43 0.09 301 0.157 NOv 1.34 0.08 296 0.150 De I.26 0.08 303 0.151 a/ COilectar areao 4 2. b' Elactrietty Is th, fuel displaced, tho officelncy of fuel uw Is 100%. Sourco: Mission Calculations* Annex 6 Page I of 6 NARKIET POTEWNIAL ESTIMATES Table 6.1: ASSESSMENT OF MAXIUt tMAET AD FUEL SAVINE POTENTIAL FOR 1985, HOTELS - OOWERCIAL SECTOR Fuel Saved By SWH Syttems c E-lectricitY _ _ Fuel Oil Keroseneo ood Uteful Maximm S of Total - S of Tatal . S of Total S of Total Solar Energy Number Beds Fr Fuel Wds For Fuel Beds For Fuel Beds For Fuel Region Wr Bed a/ of Beds / Region Saved Region Saved Region Saved Region Saved (OJ/yr) (No*) (5) (TOE/ye) 1) (TOE/yr) Cl) (TOE/yr) CS) (TOE/yr) Nairobi 3.08 9,563 16.8 340 83.2 918 -- - Coast Beach 2.71 10,836 53.6 1,084 46.3 5O0 -- - - Mombasa 2.71 2,132 53.6 213 46.3 100 C - c% Cost Hinterland 2.71 913 53.6 91 46.3 43 -- - - ° Masalland 3.08 1,164 -- - -- -- 100 268 Nyanza Basin 3.08 836 -- - - -- -- -- 100 193 Western 3.08 534 40.0 45 - - 60 74 Central 3.08 2,668 16.8 95 83.2 256 - - - -- North Kenya 3.08 144 -- - 90 51 10 3 Total 28,790 1,868 1,826 Sl 535 .1 Wlth hotel occupancy of SOS (average). b/ Government of Kensa: StatlstIcal Abstract 1985. cl Efficioncy of fuel uset electricity, 100%; fuel oil, 555; kerosene, 18$S and wood, 10%. Source st0K Obcuments and Mission Estimates. Annex 6 Page 2 of 6 Table 6.2: ASSESHENT OF MAXIMUM M AKET AND FUEL SAVING POTENTIAL FOR 1985, RESTAURANTS - COWMErC1AL SECTOR Fuel Saved by SUN Systems / EhectricIty Fuel Oil Kerosene Wood LPB Charcoal Energy Saved Total Coll ctor S of Fuel S of Fuel S of Fuel S of Fuel S of Fuel S of Fuel Restaurant Per Year Area Required Total Saved Total Saved Total Saved Total Saved Total Saved Total Saved (GJ/82) (22) () (TOE) () (TOE) (5) (TOE) (S) (TOE) (5) (TOE) (5) (TOE) Urban 4.45 59,334 20 3,638 -- - 15 4,861 15 2,966 25 7,807 *5 7,008 Rural 2.36 9.202 - - - - 5 133 80 1.302 - - 15 345 - - -~~~~~~~~~~ Total 68,336 3,638 4,994 4,270 7,607 7,353 -j I .1 Efficlency of fuel use: electricity, 100S; fuel oil, 55%; kerosene, 16$; wood, 10%; LFP, 16$; and charcoal, 15S. Sobrces 00K Documents and Mission estImates. *j; . 8 * P S * *- 0;S Annex 6 Pap 3 of 6 Table 6.3: ASSESSMENT OF MAXIMUM PAURET AND FUEL SAVING POTENTIAL FOR 1985, ODIA)INS SCHOOLS - PUiLIC SECTOR Fuel Saved by SHW Systems _ Number of Electricity Fuel OI Kerosene Wood LPG Charcoal Boarding Energy Saved Boawders S of Fuel S of Fuei S of Fuel S of Fuel S of Fuel S of Fuel Schools P.r Boarder 1983 Total Saved Total Saved Total Saved ,otal Saved Total Saved Total Saved (6j) (No.) (S) (TOE) (S) (TOE) (5) (TOE) (5) (TOE) ( () (TOE) (S) (TOE) HIgh Cost 2.12 1,925 100 281 - - - - - Medium Cost 1.696 1,736 50 101 -- 20 76 30 66 - - - Low Cost 1.059 32,275 -- -- -- - 20 60o 60 1,537 - 20 726 Teacherts College 1.272 12,392 10 108 20 118 10 203 35 413 5 97 20 334 Secondary 1.272 205,860 - - 40 3,924 15 5.059 30 5,887 5 1,607 10 2,780 Technical 1.272 9,318 40 326 20 s8 - - 20 177 - - 20 251 Polytechnics 1.272 4,723 50 206 40 90 10 77 - - - - - - Speciol Ed. 1.484 3,764 40 153 10 21 20 144 10 42 - - 20 116 Universities 1-696 7.697 5 45 95 464 - - - - - Total 279,690 1,220 4,705 6,439 8,122 1,704 4,209 p/ Efficiency of fuel use: electricity, 100%; fuel oil, 60%; kerosene, 16S; wood, 10S; LPG, 186 end charcoal, IS$. Sorc.: sGK Documents and Mission estimates. Annex 6 Peg 4 of 6 Tabe 6.4A: ASSESSMENT OF MUINM MI(T AND FUEL SAVING POTENTIAL FOR 1985, * SPITALS - PUBLIC SECTOR Fuel Saved by SNW Systems _ Nuer of Electricity Fuel 01I Kerosene bod I Energy Saved Patloets S of Fuel S of Fuel S of Fuel of Fuel of Fuel Reion Per Pat Iet 1964 Total Saved Total Saved Total Saved Total Saved Total Saved (i) (No.) (SI (TOE) (5) (TOE) CS) (TOE) (5) (TOE) (5) (TOE) Nairobi 3.287 5,666 1 192 85 593 - - - - - - coast 3.286 3,035 20 137 so 299 - - -- - - East 3.286 4,330 tO 98 20 106 40 733 10 106 20 349 Nwtheast 3,27 418 - - - - S0 aS 50 51 - - Central 3.286 4,696 20 221 60 482 - - - - - Rift Valley 3.266 5902 25 334 30 218 - - 30 436 15 357 Nyanz* 3.287 4,155 20 188 20 102 15 263 30 307 15 251 Weste," 3.2B7 2.791 40 252 10 34 10 118 30 206 10 112 Total 31,193 1,422 1,834 1,202 1,106 1,069 I/ Efficiency of fuel uses electricity, 1003; fuel oil, 60; kerosene, 185; wood, 101; LPG, 185. Source: GOK documents and MIssion estimates. p v * 1 Annex 6 Page 5 of 6 Table 6.5: ASSESSMENT OF MAXIMUM MAKET ANM FUEL SAVING POTENT!AL FOR 1965, HEALTH CENTERS - PUBLIC SECTOR Fuel Saved by SWHi Systems a/ Total Number Electricity Fuel Oil Kerosene Wod LPG Charcoal of Patients % of Fuel S of Fuel S of Fuel S ot Fuel S of Fuel tof Fuel Region 1985 Estimate b/ Total Saved Total Saved Total Saved Total Saved Total Saved Total Saved (No0) (5) (TOE) (T) (TOE) ( t) (TOE) (S) (TOE) (S) (TOE) ( () (TOE) NaIrobi 4,120 100 255 - -- - - - - Coast 13,390 662 -- - - - - 20 294. Eastern 20,065 30 372 -- 40 928 - 30 663 - - Northest 4,120 5 12 - -- 50 238 - 45 204 - Central 21,115 95 1,239 - - - 5 116 - - RIft Valley 42,230 60 1,565 - 10 487 10 283 1S 697 5 201 Nyanza 28,325 25 437 -- 25 818 20 380 10 311 20 539 Western 17.150 40 432 - - to 202 20 235 10 192 20 333 Total 150,895 4,974 2,673 $98 2,477 ,073 aJ Efficiency of fue; use: electricity, 100%; fuel oll, 0,6; kerosene, 16%; wood, 10%; LPG, 16% and charcoal, 15%. ;/ Energy saved pe patient Is 0.897 0J/year. Sourcoe: 60K documents and MIssion estimates. Annex 6 Page 6 of 6 Table 6.6: ASSESSMENT OF MAXIMUM NMWWET AND FIEL SAVING POTENTIAL FOR 1985, DISPENSARIES - PIBLIC SECTOR Fuel Saved by SH Systems __ Total Number. Electricity Fuel 01I Kerosene' wood LPG Charcoal of Patients S of Fuel ' of Fuel S of Fuel S of Fuel S of Fuel S of Fuel Reglon 1983 b/ Total Saved Total Saved Total Saved Total Saved Total Saved Total Saved (No.) (%) (TOE) (5) (TOE) (5) TOE) (S) (TOE) (S) (TOE) (W) (TOE) Nairobi 24,080 100 476 - - - - Coast 39,760 75 589 - - - - - 35 490 - - Eastern 63,560 20 251 - 45 1,057 - - 35 783 - - Northeast 5,856 5 6 - - 5 108 - - 45 93 - - Central 54,040 90 961 - - - 10 190 - - Rift Valley 22,960 40 181 20 170 20 98 15 121 5 35 Nanha 42,000 20 166 30 465 20 IS0 10 147 20 256 Western 13.440 30 s - - 20 99 20 59 10 47 20 82 Total 265,696 2,710 t,899 337 1,671 373 a/ Efficiency of fuel use: electricity, 1005; fuel oil, 0.65; keroseno, 18S; wood, 105; LPG, 18$ and charcoal, 15S. b/ Energy saved per patlent Is 0.897 SJ/year. Source: GMK Documents and mission estImates. - 75 - Annex 7 Page 1 of 14 Table 7.1 SALL 3OM-SOLAR, N3OSOLA - 306 Iletuie (Iou-Solar) a Solar got Vater Syste lot Water S,Ot Demad for Rlduelos Averag NIuu Loa TIM Of Averaximum Loa tim of Solar 11 la nzim Houth Desa_ Demood F*totr ek Demad Demud ractori/ Mle Fwnm Ommud JA .20 .93 .20 9:0 .76 1.8l .42 21:0 .8U 49 l .18 .80 .23 9:0 .56 1.9 .42 21:0 .79 50 MAR .24 .94 .26 9:0 .72 1.74 .43 21 to .' 46 An .23 .75 .30 1:0 .70 1.69 .41 21:0 .94 56 HU .30 .80 .37 24:0 .75 1.84 .41 21sO 1.04 57 JUN .31 .81 .39 9:0 .75 1.89 .40 21:0 1.08 57 JUL .40 1.0 .40 21to .79 2.0 .40 21:O 1.0 50 AUN .30 .83 .36 9:0 .76 1." .39 21:0 1.16 58 sly .24 .75 33 1l0 .73 1.83 .40 21:0 1.0 59 OCr .21 .86 .24 9:0 .74 1.79 .41 21:0 .93 52 NOV .22 .72 .30 9:O .72 1.76 .41 21:0 1.04 59 DKC .26 .89 .29 9:0 .74 1.81 .41 21:0 .92 51 ioav iactor * Aerage eaourly lesed in the Iouth La" ip ctor - NA3Imum NeaOrlY Demad in the muth source: Midion Calcuatious. Table 7.2: LARE IOUsE-SOLI, xo*-SOLAR - NADII Reductlom to@ NlCtz (l-Solar) Solar not Water syste, Rot .er Syste Dend for Reduction Average MaxI Lead Use of Av*eage NsIs Loa Tim .f Sosla S a NaZiM month Demand Demand Fe'ztor" peak Deman Degmad ato"Peak Sytems Reumad (KU) (KU) (U) (KU) (KU)1 (BR) (NW) (2) JAN .02 .14 .14 100 .96 2.0 .*4 21:0 1.86 93 113 .05 .27 .20 9:0 .84 1.8 .46 21:0 1.54 85 N Ma .19 .57 .34 9:0 .93 2.0 .50 21:0 1.4 72 AP& .2 .72 .39 9:0 .90 1.9 .47 21:0 1.2 63 Ka. .29 .74 .39 10:0 .94 2.0 .47 21:0 1.3 63 JUN .34 .ff .33 9:O .94 1.9 .48 21:0 .98 51 JUL .46 1.! .41 21:0 .98 2.0 .47 21:0 .90 45 AC .42 1.1 .38 24:0 .99 2.0 .49 21:0 .90 45 SEP .26 1.0 .26 10:0 .96 1.9 .49 21:0 .92 47 OCT .18 .90 .19 lOsO .9 2.0 .48 21:0 1.1 55 NOV .22 .92 .24 9:0 .92 1.9 .48 21:0 1.0 52 DEc .17 .78 .22 10:0 .94 2.0 .47 21:O 1.2 61 J *w rg~AVIZLl fotLt Dmtlo uith a/ Lead Factor * AeeNarly D n In the onth OWLS= Nowrly Demnaud I the Month Iour to: wielton Calculations. . -. .-.-... -76 Annex Page 2 of 14 TabS e 7.3: LARG NOUSZ-SOLAR, NOSOWLAR- KOMA Deduction Eectri (younbir) Mi2L solar Not Water System Rt Vater System Demand for lAduction Average Kaziam oa-d 7iM f kAvetag Madxi _ Lead Tim o s biar Si s n Malium bath De c ea- d W peeto a leak emand DemWn pactor/ pek Mstem Demad * ~~~~~(SW) (KU) (U) (KW) tax (I) (KW) (2) JAN .14 .74 .19 11.0 .94 2.0 .47 21tO 1.26 63 Mn .15 .49 .22 9:0 .82 1*8 .46 21.0 1.11 62 al, .22 .84 .26 9:0 .90 2.0 .50 21:0 1.16 58 APR .21 .98 .21 10:0 .88 1.9 .46 21.0 .92 48 MNW .31 1.04 .30 9.0 .93 2.0 .14 21:0 .96 48 JUl .33 .96 .34 9sO .93 1.9 .49 21sO .94 49 JUL .45 1.GI .42 9:0 .98 2.0 .49 21:O .92 46 AM .30 1.02 .29 9:0 .97 2.0 .*49 21:0 .98 49 W 3 .23 1.06 .22 9:0 .91 1.9 .48 21:O .84 44 Ocr .18 1.05 .1? 10:0 .92 2.0 .46 21:0 .95 48 NOV .19 .94 .20 lOsO .89 1.9 .47 21:0 .96 51 DEC .25 .77 .33 11:0 .93 2.0 .47 21:0 1.23 62 al Load ractor eDe-ad " the %nth m 3axiua burly Demoad in the bath Sorce:s Kiace Calcultion. able 7.4: LARE 110 -0LAR NAI1ROI Reduction In lectric (Non-Solar) MsxLuia b3Lat Not Water System got Water Ssltes Demand for Reduction Average Maxwu Load TiM of Average Maxim Load Tim of bolar SW La Maximm bath Dmand Demand Pctora Peak Dem Demand ractori lek Sste. Demand (SW) (1"W (RR1) (IV) (KW) (llV (KW) (S)-- JAM .020 .139 .143 10:0 .960 2.0 .48 21:O 1.861 93.0 Mn .053 .267 .198 9:0 .341 1.S06 .46 21:0 1.539 85.0 MAR .193 .565 .341 9:0 .931 2.0 .50 21:0 1.435 71.75 APR .264 .721 .393 9:0 .902 1.935 .466 21sO 1.214 62.7 NAT .287 .741 .387 10:0 .944 2.0 .472 21:O 1.259 62.9 JUN .318 .953 .333 9:O .937 1.935 .484 21:0 .982 50.7 JUL .455 1.104 .412 21:0 .978 2.0 .468 21:0 .896 44.8 AUG .418 1.100 .38 24:0 .966 2.0 .493 21:0 .90 45.0 831 .260 1.017 .255 10:0 .955 1.935 .493 21:O .918 47.4 OCS .175 .901 .194 10Os .964 2.0 .482 21:O 1.099 1.9 NOV .220 .924 .238 9:0 .923 1.935 .477 21.0 1.011 52.2 DEC .173 .760 .221 10:0 .9S0 2.0 .47 21:0 1.22 61.0 Load Factor * Aversg Iurly Demand In the bath maximu lburly Demand in the bath source: Mission Calculations. Annex 7 Page 3 of 14 table %.5 CW6 ISON OF PEM MAI) NO LOAD FACTR FOt S4LM AM t*SOM (ELECMRIC) WATIER IATING SYSTEMS SMALL HOUSE., NAIROB Electrlc (On-Solar) Solar Not Wate Syste l_t Vot System Time Time Rdugctioa in NIstml Averae aaximm Load of Average Maxi mou Load of Dand due to Moth Demand Demand Factor b/ Peak Domand Dmand Ftoe b/ Peak Solar Water Heaters (kV) Iil N) (kV) {i) (HR201) (kV) (HR) Jan .09 l.09 .08 10:0 .17 1.91 .40 21:0 .62 43 Feb .10 .60 .13 10:0 ..8 1.66 .40 21:0 .In 52 Mar .21 .73 .29 10:0 .75 I.65 .41 21:0 1.12 61 Apr .27 .86 .31 9:0 .172 1.61 .40 21sO .93 -51 May .28 .18 .36 9:0 .76 1.93 .39 21:0 3.35 a0 Jun .30 .89 .34 24:0 .75 1.92 .39 21:0 1.03 54 Jul .40 .97 .41 21:0 .o9 2.00 .40 21:0 1.03 52 Aug .37 .96 .39 22:0 .79 2.00 .40 21:0 1.04 52 Sep .26 .95 .27 1:0 .77 1.93 .40 21:0 .98 51 Oct .21 .07 *24 9:0 .78 1.98 .39 21sO 1.11 56 Nov .23 .70 .33 1:0 .74 1.90 .39 21:0 1.20 63 Oec .20 .78 .26 9:0 .76 1.92 .40 21:0 1.14 59 a/ Electric power required to circulate water 25-30 watts the reainder power Is attributed to stanAby elcttric beater is existing systems opWrating under Inclement weather, to which SUN system would bo retrofitters. b/ Load Factor a Averae hourly demand In the month Maxlimm hourly demand In the month. Source: Mission calculations. - 78 - MAnne 7 Ta 8e4 of 14 A PIOCEDU FOR DmRKINING THE PRICE OF EEf THAT UTILITIES CAN QIACGE PRICE a k1 .(Initial price of equipment) + k2 -(Initlal OW costs) + k3 .(Itial energy costs) + (Levelised replacement costs). port uttlti, theo bove equation La written as: PRICE k; K;+.k;"E(1) + k..MD L -1 k. to (t)Mot tin' ;~~~~~~~~~~~~k k- k's"' k s' (7.1) Flt-Yok 4 NO I (t)M(t) kt" PT1 + IN + MI1 " 1-T x [TX DEP(a.DP.Ru _ 1aC-Rm( 3 4() CReF(R,) 1+W f 1 C T XDEP(a.DP.R)J (7.4) 1/ EThe Cost of EnergV from Utility-Owned Solar Electric Systems: A Required Revenue )Ithodology for ERDA/ZPUE Evaluation,, ERDA/JPL-1012-76/3, June 1976. -79- MAG7 Page S of 14 OUTLAYS (t)mKo IPT+INfbrb*f,r.+f,r,* SRU.LNU +tAX(t)+ TAX(t)uT INCOME(t)-( .+) (MO.M(t)*E(t)) - Ko (f4rb ePTIN+ o(a.OP.t)) ,(deductis fom ma rplaceentsl -Ko ITC (t- 1 (7.6) Ken I K(t) [L i J(77 a S(R.LNJ -1 (7.8) 0 If ago DPICRF(R.DP)J if a-l DEP(a.DP.R) (&IDP) !JLIL.- . | r! -it)t -1,[tl+ R)Do- 1 -to- (DP-to +l)] R (I 4,R)Oi J Ifa1 t, finst integer greater than or equal to 1 + OPV -1/a) (7.9) R*,(1-T)rbftbr..+fe fp ' ' ' (7.10) O(a.Di.t) a (a/DP) (1 -/DP),-, tc to (I-a/D°)- {D-t6+l) t 3 to t * a ef fa for which t X fftb rw or equaltol + DP (1*l) (7.Ll) -80 - Ann 7 Page 6 of 14 CRY (d,L) L * 12) 2;-^FdO2 (+I (7.13) k* CRF(d,L) / CRF(d',L) d' (I 4) (I )-l t(7.14) k3 k3 * <~~~~~~~~~~7.15) V~~~~~~~~~W3k -81- ~~~~~Annex 7 Page 7 of 14 a aeead deprcaton multiplie (a a I h a sr fa deemining the enrgy t* straIght eel fo double.de. Mpoet of the lWeli2ed PRICE paid iinboiw ) by w fsaro nrgyfrom thenrgy r.L Intest pad dun ye t onh1.00of Ws In the tit VW of the sytem's Oet 3) lo intert r eL er (a. ope ion* fiedinequation'12) hkmuitiplir f deteminino no rutine CR(dM * pal rOY or hr loAn with maint compo t of tie ve"ied inteest d payal or L yQe (defined PRICE Pi by cwtom fromn the c St InequtlonX dof rout neanterance in the fir yu d * oWUNrdiSount SIC of the sytmsoption' 4. meeneaS dbeoumt ste In onsant k( *multiplier for determining the dollarfi + d') a 0 + 1 * I contribution of a mor m e laent OaOt) * permitted depreia of $1.0 of initi ome during Yer m to the invelid tmet In Yea I ogen a peritted PRICE Pad by ustome give te cost deprcil Ulfetime of OP and an eol. of the replacement in yer t meurd In erated deprecation muitiplieo of a(defIn. dolil valued during the firt yw of the d i equatllon 22) stems tion OIDEP(,0R) t present ValUe of _petlon with L perod tw which sstem costs are accelorad de it multiplier a, masured eglation perw DP, and discount LN a prid of loan rate R(deflned In equation29)M 4 a mrute oprting cuots In tV firt yea DP depretI pei of m steWma option gm pment fo eergy made dutng ya I m) mo pam ts made dn ywea t (evaluted In costarnt doUif vaklud at Of tho ytem oprtion (esured In tetvit tyearofthosystemsOpation) ollr valued at the first yr of the a ft of N va of systemotion). Fo ot ye t) FIX A fae chare made, by a ulity or othw N *th systms lIfe in per iunduti to cove leeized capitel ex., nmber of Year require to constuc a passes and yl the desid rt of M lave plant or sytem am *G N, -lff olcmts f4 faction Of uUlity plant flcd with V(d * prwsent vlue of a ch flow given a bonds discount rated (ddefie In equation 1) fts frctin of utility pant finanC With PAIC5 * evlad anua prc chared to the common Stock - ftractionco uiiypatfncewthPT a fralon of Initll capital value of the psrefed ftot eInqmon unt pad annually for popert tax ofanua Gate Vof InflanatMfn g a interet rat P paion mortgages IW - fra lon o aitl e olt pat pom rAl and Industral equired ate MWI_uWSSMS ott rturn dCOMEt) gro receipts rceivd by a systen O utftys pwemittad tte d rturn (define owne during ya t df a stems opera, I aont tuat 34) ITO a bnvestment to crei (rcto of caita r w Iteet te paid by utilieson bonds value of pant deductd from ta in ri = rturn paW utits on comnon stock frfdrperaluot) C a return Paidbutibities& on prfee Stock Instaled Intial ast o equiment annal mount d by ultfIltiesIto a Ko a Wamm M" am of OwAwt dsinking fund to etli dt at the nd of Inuin inltion intest duing LN Yr amin tht the fund is n _Construcion is te vauted In dollus vesd at a retun oft R (dined In Qua. lued at the fist yea of the systews tion35) tsewti M d _ t the yr dof sytem operation under plants construction (eauated In dolls T a n icom tax rate (def!ned In equation valed at the firs yea of the systems 11) k. -multiplier for determining the tate icm tax rate _Ip lo ailsted componntw of th evel TAX(t) Icme tax "aid In yer t bed PRICE paid tp utwomer for energ j f) a a switch f", cton used far cneine frosthe initial installed coer I Nt)a0 uls ta0 In which case i0 I 'oPloge -7 o 1 .. ~ ~ ~ i?sm% ~ bmmau.gmam'mF.flmiimiea.wanm..gmuSs.sswm NUMBER OF EACH HOUSE TYPE WEATHER| D-4 SWH INSOLATION-0 SvUTION MODEL TOIE EAN HISTORIES ~TIME HISTORIES NUMBER OF EACH HOUSE TYPE 7~~~~~~~~~~~~~~~~~~~ 1 UT-A ... IWATER A l NRf 24 l w l ;~~~~~~~~~~ w FICIRE 7.1 - TYPICAL DIWMID ANALYSWS SIMULATION FLOW DIAGRAI Source: "Solar Heating and Cooling of Buildings (SUACOS): Requirements Definltion and o Impact Analysis". Electric Pover Research Institute, Palo Aito, California. USA. Report EPRI, ER-808-SY, 1978. -83- Anuex 7 Page 9 of 14 4 3 2 'U K p r I I I I I. 1.0 2.0 STANDARD DEVIATION OF 'WAKE-U TIMES (HOURS) FIGURE 7.2 - RATIO OF PEAK DEMANDS TO AVERAGE DEMANDS AS A FUNCTION OF THE STANDARD DEVIATION OF "WAKE-UP" TIMS Source: "Application of Solar Technology to Today's Energy Needs", Vol. I, Congress of the United States. Office of Technology Assessment, Washington, D.C., USA. June 1978. 8 NI NoD0 II 1IHotow 2 4 p j l | \ -'-i~~2 Ha §~ ~ ~ 1 1 ,1,- - . '1 WITH ~ ~ II m* OF D 65 ~~~ ~ ~ ~I 4~~~1 4 2~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 2 VA\ J N~~~~*AAV I I g.4.....f....~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~....... ... 2 4 a ~10 12 14 18 l8 20 22 24 *~~~~~~~~~~~~~~~~~~ *m TNME OF DAY 0HOURS) FIcvUU 7.*3 - HDURLY "KILSCELLANUOUS" ELECTRIC LOAD) PROFILE TOR SINGLE FAMILY IROUSE0 WITH DIFFERENT TYPES OF DJ.ESMIT Source: "Application of Solar Technology to Today's Energy Needs", Vol. I, Congress of the United States, Office of Technology Assessment, asehington1. D.C.. USA. June, 1978. _ -b _4Annex 7 Vas 11 of 14 *Figre 7.4: EXAMPLE OF MEASURED PERFORMANCE OF SWH AND NON-SOLAR ELECTRIC WATER HEATERS IN A SUMMER-PEAKING UTILITY . 20 j12 45 0 .8 30 OA 0 0 3 a 9 12 15 18 21 24 $mu -ve o& G. Ut. V*jsfceI saw wow mmNowan 08ems UWiiPm oumnmG. UftWAI0AuM. ft=a 1903 -86^ Axnnx Page 12 of 14 2400 wt ~~~~~2330 - ~~~~~~2300 2230 II ~~~~~~2200 2130 2100 a 2030 L s { \ -12000 1930 1900 1830 W 0) ~~~~~~~~~~~~1800 X O } -1730 co ~~~~~~~~~~~~~1700 >- 'n 1630 COa .1600 0 z ~~~~~~~~~~~~1530 1500 1430 w ~~~~~~~~~~~~1400 1330 1300 1230 1200 m ~~~~~~~~~~~~~1130 in~ 1030 I' 1000 oo . 0930 *0830 '~0800 LU E 0730 E 0700 'E06300 0530 0500 0430 0400 0330 0300 0230 0200 0130 0100 0030 o 0 0 a 0 0 0 0 0 o 8MALL HOUSE - NAIROBI - JANUARY SMALL HOUSE - NAIR03I - JULY 1.00 2.00 r44 I7 3aS 1 t3t 2I a S 6 1t .15 . . '5 Hours Hours Figure 7.6: Daily Electric Dlemand for Solar nd Mon-Solar Electric Water Isatiuug Systems for January and ,1uly - Sall House, Nairobi SMALL HOtISE - MOMBASA - JANUARY SMALL HOUSE - MOMBASA - JULY 2.25 2.25 2.00 2.00 5.75 1.A0 1.26 ~~~~~~~~~~~~~~~1.25 0emsouC 1. .00 5 1 .00 u U :I @1"