In recent years, South African mining companies have significantly increased their solar installations. Over 200 MW of solar power has been registered with the National Energy Regulator of South Africa (Nersa).
Data from the Outlier indicates that between May 2019 and 2024, 16 mining companies registered 242 MW of private electricity generation with Nersa, with 93% of these registrations being for solar power.
Harmony Gold leads with 144 MW of solar power registered for its mines in the Free State, followed by Glencore with 60 MW. In 2023, Harmony Gold projected that its solar installations would save R425 million annually in electricity costs and help achieve net zero by 2045, with completion expected by 2025.
The exception among these companies is Samancor Chrome, which registered 17 MW of gas electricity for its Gauteng smelter. Gauteng province saw the highest number of registrations, with seven out of 20 companies generating private power registered with Nersa.
This shift towards solar energy follows years of Eskom’s failures, which have disrupted industry production. As an energy-intensive industry, mining has been severely impacted by Eskom’s load-shedding and load-curtailment. Minerals Council SA’s chief economist, Hugo Pienaar, highlighted that in November 2023, real mining output was still almost 4% below pre-Covid-19 levels of December 2019. Eskom’s inconsistent electricity supply has been a significant factor in this decline.
The mining industry is vital to South Africa’s economy, being a major employer and taxpayer, and one of the most energy-intensive sectors. A March 2023 report by Fitch on the impact of load-shedding revised growth forecasts for mineral production, projecting a -1% year-on-year decline for iron ore and a -2% decline for platinum.
The industry’s move to renewable energy is part of a broader trend of businesses and households moving away from Eskom to alternative power solutions. This growth in solar installations positions South Africa to become the world’s tenth-largest solar photovoltaic (PV) market in 2024.
Globally, the PV industry added about 444 GW of new capacity in 2023, a 76% increase from 2022, with installations expected to top 520 GW in 2024 due to record-low solar module prices and ample component supply. In South Africa, Eskom estimates 2.6 GW of rooftop solar additions in 2023, while the BloombergNEF database tracked an additional 676 MW, bringing the total to about 3.3 GW.
Rooftop solar growth is expected to continue, especially during winter months when load-shedding is more frequent. Residential solar demand correlates directly with load-shedding intensity, while business adoption of rooftop solar is anticipated to accelerate.
Demand for solar products peaked in mid-2023, driven by intense load-shedding and a rooftop solar tax break. The first quarter of 2023 saw R3.6 billion worth of solar panels imported, followed by a record second quarter with R8.4 billion worth of imports, driven by fears of increased load-shedding and the new tax break.
This sustained demand has spurred local business opportunities, potentially fostering a local solar panel manufacturing industry. Since 2010, South Africa has imported nearly R40 billion worth of solar panels, initially supported by government investments but now primarily driven by private investment.
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