South Africa is experiencing a 15-year power crisis that is causing widespread rotational power cuts, known as loadshedding. In 2022, there were 3,773 hours of loadshedding (the most intensive year of loadshedding in South Africa’s history), according to CleanTechnica. The record levels of loadshedding have surged demand for solar panels. In the first five months of 2022, South Africa imported solar photovoltaics (“PV”) panels worth nearly 2.2 billion rand ($135 million), according to Reuters. The South Africa Rooftop Solar Market size is expected to grow from 1,983.66 megawatt in 2023 to 2,920.05 megawatt by 2028, at a CAGR of 8.04 percent during the forecast period 2023 to 2028, according to Mordor Intelligence.

Retail, office and industrial properties in South Africa’s five largest cities have 68.7-million square meters of rooftops that have no solar panels, according to a study by Gmaven, cited in Bloomberg and Engineering News. Installing solar panels on two-thirds of the commercial properties in these cities’ main nodes would cost as much as R55 billion, yet could generate electricity that leads to R12.3 billion of savings each year, according to the Gmaven study, which found that only 6.4 percent of the 41,000 properties it surveyed already have solar panels in place.

According to South Africa’s National Treasury, the Minister of Finance announced a solar panel incentive on February 22, 2023. The program is intended to encourage households to invest in clean electricity generation capacity which can supplement the existing electricity supply. Individuals who pay personal income tax will be able to claim a rebate (against their tax liability) to the value of 25 percent of the cost of new and unused solar PV panels, up to a maximum of R15,000 per individual. The rebate is not intended for solar installations at business premises.

BDO South Africa states that “[i]n the residential rental market, tenants are becoming much more solar savvy when it comes to choosing their rental property and are more likely to seek properties that already have renewable solutions in place.” According to BDO, almost all major banks now offer loans to finance backup utilities, including solar panels.

Last Updated on June 20, 2023 by Ramin Seddiq