South Africa’s Solar Boom

By Paolo von Schirach

August 14, 2024 – The African National Congress, South Africa’s governing party since 1994, is a sad illustration of African corruption and incompetence. Mostly for these reasons it lost its absolute majority in parliament in the recent May 29, 2024 elections. The most glaring example of this deadly combination of graft and inefficiency is Eskom, the state owned electricity provider. For decades, there has been no coherent investment strategy in new capacity, poor maintenance of existing power plants and transmission lines, and colossal thievery. All this resulted in what became a multi-year protracted electricity crisis that until recently appeared to be unsolvable.

Now, maybe feeling the pressure of disgruntled voters that forced a diminished ANC to form for the first time a coalition government, Pretoria somehow managed to steady Eskom. As a result, the practice of constant “loadshedding,” (read blackouts), seems to be over.

It goes without saying that continuous blackouts caused enormous economic losses to South Africa. It forced businesses, factories, hospitals, supermarkets, restaurants, you name it, to buy and operate generators (those who could afford this) on a daily basis. And this meant huge additional costs because of the high price of fuel. Now, at last, South Africans with electricity connections, (many in rural areas or poor neighborhoods do not have any), after having suffered through horrible years of unreliable service, have electricity.

That said, it should be noted that the Eskom almost total collapse triggered a veritable South African solar power revolution that may have an impact far beyond the Republic of South Africa. Just in the last two years, rooftop solar installations have grown by 453 per cent. This happened despite a context of a regulatory mess regarding solar panels, including tax rebates not applied, agreements between private households and the utility not enforced, and more. In theory, just like in other countries, households that produce solar energy could sell any excess to the utilities. In practice the system does not work.

Still, even amidst regulatory confusion, the crisis caused by the multi-year Eskom disservice created a truly buoyant solar panels market in part favored by significantly lower costs of household solar installations. Indeed, worldwide the cost of photovoltaic electricity has gone down 90 per cent in the last few years. Same for the cost of batteries to store excess electricity. As a result of this global solar market shift, semi-desperate South African consumers could find a cost-effective, off grid, household based modality to get reliable electricity.

Again, despite all the glitches and regulatory failures, the South African household solar revolution points to a future in which consumers, in Africa and elsewhere, will be able to produce and store, (thanks to much improved batteries), their own electricity in a cost effective manner.

Does this mean the end of centralized, grid based electricity production and distribution systems? May be not yet. Still, if solar panels become more and more affordable, while ineffective utilities keep raising their rates, it seems obvious that more and more households and businesses will decide to opt out of the system by producing their own electricity, in Africa and elsewhere.

The opinions expressed in this article are solely the author’s.

Paolo von Schirach is the President of the Global Policy Institute, a Washington DC think tank, and Professor of Political Science and International Relations at Bay Atlantic University, also in Washington, DC. He is also the Editor of the Schirach Report.

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