The Darling Wind Farm in the Western Cape. Alternative sources of energy is increasingly being used. Photo: David Harrison
Rolling blackouts brought South Africa to its knees. In 2023, the country endured 6,948 hours of load-shedding, costing the economy an estimated R2.9 trillion. The result was brutal, paralysing manufacturing, damaging investor confidence and leaving businesses and households scrambling for backup solutions.
Because of that crisis, something shifted. Companies stopped waiting for government fixes and began generating their own power — first with diesel generators, then increasingly with rooftop solar and battery systems. Retailers installed solar arrays on shopping centres, mines commissioned utility-scale photovoltaic (PV) plants, and agri-processors rolled out biomass solutions to keep operations running. Developers entered the market with energy-as-a-service packages. Banks stepped in with structured financing and insurers began offering products to support embedded generation. These once-fringe decentralised investments became mainstream and helped catalyse policy reforms that opened the grid to private players.
By 2024, South Africa had started to turn the corner on its power crisis. Load-shedding had eased significantly, private generation was expanding fast and the daily reliance on apps such as EskomSePush was finally beginning to fade. With more consistent electricity supply came a cautious return of economic confidence. But this isn’t just about patching up a broken system, it’s about building a resilient energy future. And at the heart of that shift are partnerships — between the government and business, between aggregators and offtakers and between Eskom and private developers.
Aggregators in particular are playing a critical role, sourcing power from multiple independent producers and selling it on to large consumers such as mines and manufacturers through Eskom’s grid. These collaborations are no longer a “nice to have” — they are powering the next phase of South Africa’s just energy transition.
The momentum is backed by real data. Eskom’s energy availability factor improved from 55% in 2023 to 60% in 2024, helping reduce load-shedding hours by 76%. Diesel usage dropped by nearly 50%, and rooftop solar capacity more than tripled in just two years. The Council for Scientific and Industrial Research says South Africa now has nearly nine gigawatts of solar PV capacity installed — a mix of private and utility-scale projects.
A strong investment case is emerging. In April this year, Eskom’s average electricity tariff rose to 195.93 per kilowatt hour — more than triple the 50-60c/kWh cost of new solar and wind projects. This cost gap has turned renewables into the economically obvious choice, not just the environmentally responsible one.
Financiers have taken note. Development finance institutions and commercial banks are backing blended finance models that combine concessional capital with commercial loans to reduce project risk and unlock scale. A notable example: the European Investment Bank and the Development Bank of South Africa’s €200 million loan package to fund private decentralised renewable energy projects across the country.
South Africa’s energy mix is now nearly 10% renewable (excluding hydro), a figure expected to double in the next decade. Rooftop solar installations more than tripled from 2022 to 2024, reflecting not just the desire for energy security but also growing consumer and business confidence in clean power.
But deeper trade relationships and long-term industrial strategy are needed. Much of the equipment powering this boom is imported. Last year alone, South Africa imported more than 3.8GW of solar panels and related components. That volume highlights both the depth of current demand and the untapped opportunity to manufacture key parts of the green energy value chain locally. The department of trade, industry and competition is now developing new incentive schemes to catalyse domestic manufacturing of inverters, batteries, electrolysers and more. If the country can align trade policy with investment and technology transfer, it could become a serious player in solar and green hydrogen production across Africa.
South Africa is also positioning itself to export green energy regionally. Its installed capacity and wheeling infrastructure give it a potential edge as a regional energy hub, helping stabilise neighbouring grids and supporting industrial growth across the Southern African Development Community. Cross-border wheeling frameworks and regulatory alignment are already in discussion, signalling intent to unlock long-term opportunity beyond the national grid. These talks are essential for regional energy integration and to build new markets for surplus renewable power.
Equally important is ensuring that the transition is just. Communities that rely on coal must see meaningful alternatives: jobs, retraining and local procurement. The Presidential Climate Commission and National Planning Commission are working with municipalities in coal-heavy regions to plan how renewables can be a vehicle for inclusion and opportunity — not displacement. If the green transition doesn’t improve livelihoods where it matters most, it risks deepening inequality rather than addressing it.
None of this will be easy. Grid investment remains urgent. Regulatory clarity on wheeling and storage still lags. And many communities still feel left out of the energy conversation. But the foundations are in place, and momentum is real. Rooftop solar is becoming mainstream. Wheeling deals are accelerating. Eskom is stabilising. And international capital is flowing.
South Africa didn’t choose this energy transition — it was forced into it. It now has the chance to reinvent itself.
Mark Evans is a partner at Oliver Wyman’s energy and natural resources practice.