Publications
Partners
- In the first half of 2023, South Africa imported about R12 billion worth of solar cells and solar panels.
- This is more than double the value of imports for the whole of 2022.
- There are still only three solar panel manufacturers in the country.
- For climate change news and analysis, go to News24 Climate Future.
In the first half of 2023, South Africa imported about R12 billion's worth of solar cells and solar PV panels, as load shedding hit record levels in recent months.
Gaylor Montmasson-Clair, senior economist at independent think tank Trade and Industrial Policy Strategies and facilitator of the South African Renewable Energy Masterplan, last week shared a graph on X (formerly Twitter) highlighting the influx in solar PV imports.
Look at this curve! The flood of #solar panel imports into SA continues: $650 million (R12 billion) in the 1st half of 2023. That's roughly 2200 MW worth of panels.Great to see the transition to #renewableenergy accelerate, but we need to seize the industrial opportunity! ???? pic.twitter.com/xohCECGMOV
— Gaylor Montmasson-Clair (@GaylorTIPS) August 2, 2023
It shows that in 2022 solar imports were around R5.6 billion. In the first half of 2023, this had more than doubled to R12 billion (R3.6 billion in the first quarter and R8.4 billion in the second quarter).
Montmasson-Clair shared a similar graph on Monday, this time showing the value of imports of lithium-ion batteries and inverters that are generally used to support solar PV systems.
Collectively, South Africa imported $2.5 billion (R47 billion) worth of solar panels, lithium-ion batteries and inverters, compared to $1.7 billion (R32 billion) in the whole of 2022.
A picture is worth a 1000 words. SA has imported $2.5 bn worth of #solarpanels, lithium-ion #batteries and inverters in the 1st half of 2023.So great to see the exponential rollout of #RenewableEnergy in SA, but what a missed opportunity for local industrialisation! pic.twitter.com/4dr8FI2sw5
— Gaylor Montmasson-Clair (@GaylorTIPS) August 7, 2023
Montmasson-Clair explained to News24 that these imports could largely be attributed to households and businesses trying to beat load shedding by investing in small-scale embedded generation solutions like rooftop solar.
By May this year, the amount of load shedding measured in gigawatt hours exceeded that of the whole of 2022.
Outlier, which has been tracking load shedding using data from EskomSePush, shows there have been 218 days with load shedding in 2023, compared to 205 in 2022. Stage 6 has been implemented on 36.4 days in 2023 – more than any other year.
Other factors contributing to the spike in imports could be linked to electricity price increases. The National Energy Regulator of South Africa (Nersa) had allowed Eskom an 18.65% tariff increase that kicked in on 1 April this year.
Montmasson-Clair thinks that the tax incentive, announced by Finance Minister Enoch Godongwana in February, may also have "slightly" contributed to the increase in demand for solar PV systems.
Large-scale project developers like Scatec, which is building a hybrid solar PP and storage project in Kenhardt in the Northern Cape as part of government's emergency procurement round, have also been adding to the demand for imports. Some businesses which which took advantage of the lifting of the licence threshold of generation projects back in 2021 are also starting to import.
The licence threshold was lifted altogether last year to help accelerate the process to get more power to the grid.
But Montmasson-Clair is convinced that households and businesses drive the majority of imports. "… certainly, at the moment, [it is the] small-scale embedded generation market that is absolutely booming - and that is across residential and business," he said.
READ | World Bank to help fund 1 000 mini solar power grids in Nigeria
Montmasson-Clair noted that the massive imports reflect a missed opportunity for local industrialisation.
Currently, there are only three solar PV manufacturing and assembly plants. They are ARTSolar in KwaZulu-Natal and Seraphim in the Eastern Cape, while the third is Ener-G-Africa in the Western Cape, which has a different target market, supplying small solar panels.
The South African Renewable Energy Masterplan seeks to address this dearth of local manufacturing capacity by developing domestic value chains and skills among workers for solar panels and battery storage technologies alike. This is because the country anticipates there will be a rapid increase in the rollout of renewable energy technologies, as is true for the rest of the world, to ensure energy security and also to lower carbon emissions from the electricity sector.
The draft of the plan was released in July, and the public has until 18 August to submit comments.
