The growth of solar energy in South Africa

South Africa has been making significant strides in harnessing solar energy as a sustainable and clean power source.

Market growth

With abundant sunlight and a growing demand for renewable energy, the country is well-positioned to expand its solar capacity. South Africa is set to become the 10th biggest solar market in the world. In 2023, R17.5 billion rands of solar panels were imported into this country. At the end of quarter one 2023 there were approximately 126,000 households in South Africa that had solar PV. Residential solar installations make up approximately 85% of all solar installations in the country and the rest is commercial, industrial all the way up to utility-scale installations.

The installed base of solar energy in South Africa is expected to grow from 6.68 gigawatts in 2024 to 11.03 gigawatts by 2029, at a compound annual growth rate (CAGR) of 10.56% during the forecast period. The increasing demand for clean energy sources, unreliable electricity supply for Eskom and efforts to reduce reliance on coal-based power plants are driving this growth.

Expanding the indigenous solar manufacturing industry presents lucrative opportunities. Transitioning from fossil fuels to renewables requires deploying approximately 150 GW of wind and solar capacity by 20501.

Solar photovoltaic (PV) dominance

Solar PV technology dominates the market. South Africa receives more than 2,500 hours of sunshine annually, making it an ideal location for solar PV installations. The Northern Cape, in particular, boasts one of the most attractive solar resource areas globally.

The rooftop solar market, a key component of the residential sector, is estimated to reach 3.15 gigawatts by 2029, growing at a CAGR of 8.04% during the forecast period. This growth is not only a testament to the economic viability of solar power but also reflects the societal shift towards sustainable living.

Some of the notable solar projects in the country include:

De Aar Solar Power

Located in the Northern Cape, the De Aar project is the largest solar farm in South Africa and Sub-Saharan Africa. It spans 473 hectares on a 2,674-hectare farm and has a photovoltaic (PV) solar capacity of 175MW. Over half a million solar modules convert sunlight into electricity, providing power for approximately 75,000 households annually.

KaXu Solar One

Situated near Pofadder in the Northern Cape Province, KaXu Solar One is South Africa’s first commercially functioning solar thermal electric power plant. With a capacity of 100MW, it supplies sustainable energy to Eskom under a 20-year power purchase agreement.

Jasper Solar Power Project

The Jasper Solar Power Project has a capacity of 96MW. It contributes to South Africa’s renewable energy goals by harnessing solar energy efficiently.

Mulilo Sonnedix Prieska PV

This solar project has a capacity of 75MW and plays a crucial role in South Africa’s transition to greener electricity generation.

Xina Solar One

Another 100MW concentrated solar power plant near Pofadder, combined with KaXu Solar One, forms the largest solar power complex in Africa.

The role of battery energy storage

Battery energy storage plays a crucial role in South Africa’s solar energy sector, addressing several challenges and enhancing the effectiveness of renewable energy systems.

Mitigating load shedding

Battery energy storage systems (BESS) help alleviate production losses related to load-shedding-induced downtime. During periods of excess solar energy generation, batteries store the surplus electricity. When the grid experiences load shedding, these stored energy reserves can be tapped to meet demand.

Balancing the grid

By capturing and storing renewable energy like solar power, BESS provides a backup power source for South Africa’s electricity needs. Batteries contribute to grid stability by balancing supply and demand. They can release stored energy during peak demand hours or when intermittent renewable sources (like solar) are not producing.

Economic benefits

Battery storage helps avoid substantial spikes in energy costs during peak demand. It enables efficient utilization of solar energy, reducing reliance on fossil fuels and lowering electricity bills.

Investment requirements

To transform its renewable energy system, South Africa needs an estimated USD 250 billion over the next three decades, equivalent to around 3% of the country’s GDP annually.

This investment will drive the deployment of solar and wind projects, contributing to the overall growth.

Natural gas consumption

The rising consumption of natural gas may pose a challenge to solar energy growth. Balancing the transition away from coal while managing natural gas demand is crucial.

Regulatory environment

Streamlining regulations and providing incentives for solar projects can accelerate growth. Clear policies and supportive frameworks are essential.

Local manufacturing

Developing local solar manufacturing capabilities will enhance self-sufficiency and create jobs. Encouraging investments in solar panel production can boost the industry.

South Africa’s solar energy sector is on an upward trajectory, driven by favourable conditions, increasing demand, and a commitment to sustainability. As the country continues to invest in solar infrastructure, it will contribute significantly to the global shift toward cleaner energy sources.

The information contained in this article is of a general nature and intended for information purposes only.