Bright year round sunshine, a failing public electricity supply and a world class renewable energy procurement plan all come together to paint a bright future for solar power in South Africa. Over the past four years, investors from around the world have rushed to take part in a utility solar boom. However, slow progress updating outdated grid infrastructure threatens to stall the rapid progress so far.
At the same time, the commercial and residential rooftop market is yet to really take off. Pent up demand for a stable electricity supply has failed to translate into significant distributed generation due to a lack of regulation around grid connection and patchy financial support.
|Area||471,000 square miles||Population||52 million||Potential||4.5 – 6.5kWh/m2/day solar irradiance||Capacity||1GW+||Commitments||8.4GW by 2030 (including csp)|
Located on the very southern tip of the African continent, South Africa occupies a land area of 471,000 square miles sloping from the heights of the African Plateau in the North down to 2,500 km of coastline on the South Atlantic and Indian oceans in the South.
The country is estimated to receive about 2,500 hours of sunshine per year or between 4.5 and 6.5kWh of solar irradiance per square meter per day. This is among the highest in the world and provides great potential for photovoltaic or concentrating solar electricity production all year round.
South Africa has been repeatedly been labeled one of the most attractive emerging markets for solar power. In 2011, it came top of the IHS Market Attractiveness Index, scoring 66 out of 100 points and ranking highest in potential market size, project profitability and pipeline maturity. Thailand, the number two came a whole 17 points behind.
South Africa entered 2015 with an estimated 1GW of installed solar capacity, placing it among the global elite of solar installers and just missing out on the top 10 producers in the world this year.
Notable utility scale installations included the 22MW Herbert1 project, the 50MW De Aar project and the 44MW Touwsrivier project all completed in 2014. Also in 2014, the 96MW Jasper solar power plant came online as the largest pv solar installation in Africa.
The most notable commercial installation to date has been the Strubens Valley Clearwater mall where an expanded 1600kW rooftop system supplies renewable energy to 250 shops and restaurants.
The South African Department of Energy has publicly acknowledged the need to move away from an outdated coal dependent power supply to exploit more of the country’s abundant renewable resources.
As well as environmental concerns there is the pressing issue of the rolling blackouts that have been hitting the country since 2007. It is no secret that the national utility Eskom has been unable to meet the country’s demand for electricity for a long time now. They have been forced to implement a routine of scheduled power cuts or “load shedding” that has become a normal, if inconvenient fact of life for many South Africans.
In response to these issues, the 2011 Integrated Resource Plan for Electricity incorporated a carbon emission cap and a commitment to generate a further 17.8GW of wind and solar energy by 2030.
In the past three years, utility solar power in South Africa has increased four-fold, from 25MW in 2012 to over 1GW now. This rapid growth has been attributed to the forward looking Renewable Energy Independent Power Producer Procurement (REIPPP) Program launched by the Department of Energy in 2011.
The first two rounds of tender awarded a total of 800MW of capacity to local and international investors including Kensani Group, Intikon Energy, Rand Merchant Bank and Google who took the opportunity to put $12 million into their first renewable investment on the continent .
It was announced this year that the fourth round has secured another 13 successful bids across all technologies.
But such rapid growth cannot last forever. The national grid operator Eskom has repeatedly voiced concerns over feeding so much new capacity into their aging infrastructure. This issue delayed results from the fourth auction by 8 months and threatens continued progress. It is currently hoped that staggering commissioning of new plants will limit disruptions and provide time to organize funding for the necessary upgrades.
The rapid progress in expanding utility solar is yet to spread to the residential and utility markets. Patchy permissions and limited financial support has made connecting small grid tie systems more difficult than necessary.
In theory, incentives couldn’t be higher for small scale solar power in South Africa. Under stage four load shedding, homes and businesses can face multiple unscheduled blackouts a day for up to two and a half hours at a time. In these conditions, solar power represents one of the only ways to ensure a reliable electricity supply and protect against the threat of soaring utility bills.
Neither is the cost of solar equipment the barrier it once was. Over the past five years the price of solar panels has fallen remarkably. Local engineers claim to be able to provide systems that produce electricity at under R1 per kWh , significantly less than it costs to buy from the utility.
The relatively slow uptake has rather been put down to a lack of regulations for grid connection or financial incentives of the sort offered in Europe and USA. The local regulator NERSA is in the process of developing policy to address this, producing a consultation paper earlier this year. Solar providers around South Africa await the outcome.
you have experience with solar power in South Africa please let us know your thoughts on the future of the industry in the comments below.