Cost Savings Are Now Driving Appetite For Solar - Gosolr Ceo

South Africa has reached a tipping point, where solar installations are no longer driven by the need to keep the lights on but to save consumers money, says a quarterly update by GoSolr.

The company, which offers solar subscription solutions for households and businesses, released its quarterly update, Light Paper , which looks at the latest changes in the solar market for the period April to June 2024.

South African households have installed 5 790 MW of rooftop solar capacity as of June 2024, with 350 MW added in the second quarter alone.

While the initial growth of solar in South Africa was largely motivated by load shedding, now that some of that pressure has been removed, new drivers are emerging, says CEO Andrew Middleton ,

Speaking at a media roundtable event held in Johannesburg on August 6 he said the South African market had crossed a threshold. Weve now entered phase two of the clean energy boom, which is underpinned by cost considerations.

This is primarily because of ongoing tariff hikes by Eskom, he said.

Conservative estimates suggest that Eskoms costs will rise by approximately 50% over the next three years, whereas the cost of subscription solar packages is expected to increase by only about 13%, the paper says.

Its imperative that reliable and clean energy becomes more accessible to all consumers, including lower-incomes ones who have previously been unable to make these choices, Middleton said.

With the cost of solar installations coming down, this is becoming achievable. However, a sensible tariff in South Africa is key to democratising access to solar energy.

Eskom has proposed a new tariff structure, seeking to invert its revenue collection to 70% fixed and 30% energy charges . This aims to increase charges for grid connections and reduce usage charges.

The 70/30 split suggested by Eskom will be detrimental. Looking at models deployed in other countries, like Norway, the split between fixed versus energy charge should not exceed 40/60, said Middleton.

Government also needs to incentivise solar users. Apart from getting the best possible tariff structure, there needs to be good market signals. This means scrapping the 10% import tax on solar panels and implementing incentives that encourage households to discharge batteries when the system needs them the most, such as during peak hours and at certain times of the year, he said.