SA’s solar growth potential lies in the maintenance industry
A recent WWF report commended SA for being the first country on the continent to achieve 1GW of solar PV energy
The SA solar industry has seen remarkable growth in the past decade. Perhaps due to circumstances, the industry has outperformed many others, and bucked economic growth trends.
A recent WWF report commended SA for being the first country on the continent to achieve 1GW of solar PV energy. The country is well-primed for solar with an average of 2,500 hours of sunshine per year. Our average solar-radiation level ranges between 4.5kWh/m² and 6.5kWh/m² per day, which is roughly 40% more than Central Europe.
The industry is made up of hard-working, ambitious people who are embracing the opportunity that solar provides. Through the Renewable Energy Independent Power Producer Procurement Programme (REI4P), SA has also demonstrated that it can successfully and rapidly implement a large-scale, world-class renewable energy programme.
SA’s adoption of solar power has been referred to as a solar revolution. This has been largely driven by the private sector, both at household and industry level. We’re the second-fastest growing solar market on the African continent, outranked only by Egypt.
Many factors contributed to this. The cost of PV panels has dropped significantly worldwide, making them more affordable. The load-shedding of 2007/2008 and again from 2015 onwards, and the continuously rising cost of electricity in SA, have accelerated solar growth. Additionally, installation costs have dropped. Watershed moments included the government’s signing major solar purchasing agreements with Eskom from 2011 onwards, and when solar installations started making financial sense. From about 2016, you could recoup your costs in five to six years — a number investors find comfortable.
These circumstances have all led to the explosion of embedded generation developments, in essence PV panels installed on rooftops. What we have seen since is a mushrooming of solar plants all over the country — our current installed solar capacity is estimated to be 2,5GW.
Over the years the solar industry has matured a lot and at the same time we’ve learnt plenty. The value of correct design has been learnt the hard way. We’ve learnt that the ideal orientation of solar systems in this country is facing north at 30 degrees. Alternately, panels on south facing roofs need to be tilted to point north. Many commercial systems were built untilted on south facing roofs, resulting in an underperformance of 30% compared with north facing panels at the same location.
Inverter positioning has also improved. In Europe, due to cooler climates, inverters can be outside with minimal protection from the sun. Here, this isn’t feasible as excessive direct sunlight causes inverters to derate and produce less power. Ideally, they should be placed in cool rooms, although this is often not possible at many sites.
Solar literacy has increased significantly. Previously, clients did not know what they wanted. They now enter a discussion from a position of information. Solar systems should last 20-25 years, yet SA has some that are struggling to last 10 or even five years. Clients now come with direct experience and know to avoid the cheapest option.
There are currently about 10 major players in the solar industry, and hundreds of SMEs if you count every electrical company that installs the odd solar system. We all have different approaches, but as an industry we have grown together.
Because the industry is so much more developed in Europe, we are in the fortunate position that we can observe and learn from what is happening there. I recently attended a solar owners conference in Europe and noticed how the market has matured. with a major focus on maintenance and management. New installations are virtually nonexistent as most feasible solar projects have already been implemented. SA is lagging roughly a decade behind Europe in solar development. It is logical to see a similar progression of the solar industry in SA, albeit in our own way.
The government is showing encouraging foresight in its approach to solar. Recent legislative amendments are lowering the licensing requirements for smaller systems and enabling municipalities to procure power from providers other than Eskom. Andre De Ruyter himself has acknowledged the value that renewables can bring to the country’s energy mix.
However, solar companies need to understand that the growth phase we are in now will not continue forever. The growth in solar installations is far outperforming the growth in building developments. This means the market will reach saturation at some point, with no new building roofs available.
The growth potential lies in the maintenance industry, as all of these systems will need to be managed and kept in working order. In Europe, the titans of industry are solar maintenance companies, the umpteen service providers that clean, service and repair the existing systems.
The focus is going to shift to maximising the performance of solar systems, improving the way they are built and managing them most effectively. Consolidation on both maintenance and ownership will likely enter the fray. New players will probably start featuring as financiers and solar asset managers start to play a more active role.
We are already seeing both industrial and residential sites where systems are poorly designed and the entire roof is covered in solar panels, with no walkways between the solar panels, making cleaning and accessing panels in the middle of the solar array extremely challenging. Solar companies that wish to be future focused need to start designing and building solar plants with maintenance in mind.
It’s incredible to operate in an such a vibrant industry that has shown such resounding success over the past decade. However, to keep business sustainable solar players, whether big or small, must shift their focus from the short term low hanging fruit that installations promise, to the long term potential of the maintenance business. The two go hand-in-hand, and any solar company would be remiss to miss this opportunity.
• John is director at New Southern Energy.
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