While the South African solar energy market experienced moderate growth in 2018, in terms of new photovoltaics (PV) installations, many challenges remain on the road ahead for the country.
This is according to a new report by Solarplaza, a Netherlands-based grouping of solar energy experts, who used information from the International Renewable Energy Agency (IRENA) for the paper.
The report, called “The Big Five: Africa’s Fastest Growing Solar Energy Markets”, says the continent has shown great progress in the development of its solar energy markets over the last year.
It ranks Egypt, SA, Kenya, Namibia and Ghana as the fastest growing solar markets in Africa.
According to the report, the continent has experienced growth of over 1.8GW of new solar installations, with 1.4GW coming from PV installations, a significant jump from the 786MW brought online in 2017.
Of this new capacity, it says, around 94% was attributed to new on-grid installations and 6% to off-grid systems.
IRENA attributes last year’s growth as being mainly driven by five countries: Egypt, South Africa, Kenya, Namibia and Ghana.
Together they contributed to 1 067MW of newly-installed PV capacity in 2018, says Solarplaza, pointing out it should be noted that Morocco was excluded from this report as the market consists mostly of concentrated solar power capacity.
Fastest-growing market
Egypt, one of the sunniest countries in Africa, has enjoyed a monumental year in terms of new PV installations, making it the fastest-growing solar energy market in Africa in 2018, ahead of South Africa, Kenya, Namibia and Ghana, says Thomas Boersma, project manager at Solarplaza.
“The country’s solar industry burst onto the scene last year by adding around 581MW of new PV capacity, an almost fourfold increase compared to what it had installed in 2017, thereby overshadowing the 373MW of PV capacity added by South Africa.”
Boersma explains this was mainly due to the completion of the first installations in the world’s largest solar complex, the gigantic 1 46GW Benban solar facility, which has been one of the focal points of the country’s solar energy market.
“This has not been an easy feat, as the project consists of 32 separate solar plants with numerous parties involved, all trying to get a piece of the pie. Nonetheless, through a thorough arbitration agreement, the Egyptian Electricity Transmission Company has been able to keep all of the parties involved at bay and installations have been coming online at a rapid pace.”
Operational systems leader
SA has long been hailed as Africa’s largest solar energy market, and justifiably so, Solarplaza notes.
It adds that with an installed PV capacity of 2.5GW, the country is by far the largest market in terms of operational solar systems.
However, it points out the market has experienced some stagnation over the past years, especially due to the postponement of its renewable energy auctions.
Despite this, it notes, SA was able to add 373MW of solar energy capacity to its power mix in 2018. Most of this growth came from the rooftop/residential segment, complemented by some commercial and industrial and ground-mounted installations, the firm says.
Last year, in April, government signed the 27 outstanding renewable power purchase agreements (PPAs), bringing some much-needed hope to the market and further propelling the industry forward.
The deals, worth about R58 billion, were signed by then energy minister Jeff Radebe, much to the relief of the South African renewable energy industry.
Of these PPAs, 12 are related to solar PV projects – totalling 813MW – and are expected to be added to the grid over the next five years.
Solarplaza believes one of the challenges the South African solar market will face involves the main market driver, the Renewable Energy Independent Power Producer Procurement Programme auctions, which were supposed to take place in November 2018 for the fifth time, but has been postponed until further notice. It is still unclear when that round will take place, as the country’s main utility, Eskom, is currently going through a financial crisis.
“Besides these troubles, South Africa has set strong targets for the coming years as part of the country’s IRP [Integrated Resource Plan],” Boersma.
By 2030, he adds, SA aims to have 7 958MW of solar PV capacity, making up 10% of the country’s installed power generation mix.
“For this year, some estimates indicate the country could add as much as 700MW to its grid. However, the speed at which this can be accomplished will depend on how fast Eskom can bounce back to its feet. For now, it is inevitable that renewable energy sources, especially solar PV, form a core part of South Africa’s current and future energy mix.”
Other contenders
On Kenya, Solarplaza says it is one of the strongest and most advanced economies in Central and East Africa, and has set out ambitious goals to meet its growing energy demand by investing heavily in renewable energy sources.
The country currently has an energy mix consisting of around 65% of renewables, making it one of the renewable energy leaders in Africa.
In 2018, Kenya added 55MW of PV capacity, a new record for the country, says Solarplaza.
Namibia, it notes, the driest country in Sub-Saharan Africa, experiences more than 300 sunny days per year and has a relatively stable government.
“The country has always shown significant potential for solar energy development, but has only recently been able to truly step up to the plate. Last year, Namibia’s solar energy market was able to almost double its installed PV capacity, from 46MW in 2017, to 79MW in 2018.”
Ghana, Solarplaza says, the only country in West Africa highlighted in this report, has put an impressive amount of focus on solar energy development over the last couple of years.
The country added 25MW of new PV installations in 2018 to come to a total of 64MW of cumulative installed solar energy capacity, which is an annual growth of 76%, it concludes.
Share