South Africa’s energy landscape is poised for a significant transformation this year. From smart tech to industry shifts, here’s my forecast for what’s on the horizon.
Solar is getting smarter. Loadshedding alone was enough to convince users to go the solar route. Eskom’s recent turn-around meant that we almost went a full year without loadshedding. It is evident that many solar PV systems have not been tweaked to reflect the changing market conditions, which means that savings are significantly less than they could be. As a result, smart energy management systems will take centre stage, helping users optimise consumption and reduce waste. This includes advanced energy monitors, AI-powered analytics, and low-cost ambient intelligence solutions. For the South African market, these technologies will empower homeowners and businesses to take control of their energy usage, even as tariffs increase.
The focus on regulatory changes will be prevalent in 2025. Eskom has tried to push a change in tariff design for years. We are supportive of a reform but only if it leads to lower electricity prices for all users over time. We hope that NERSA will hear what stakeholders have been saying such that we can develop optimal tariffs together. The cost of doing it wrong can be significant.
We also look forward to seeing how municipalities implement the recently released net metering update from NERSA as it requires a transition to time-of-use tariffs and benefits for solar users exporting excess power to the grid. Despite the added complexity for customers to understand this tariff, such a transition can put the country on the right path for decarbonising its energy sector if done right.
And there will be more focus on the compliance side of installations. A national framework is being discussed, which will be beneficial in ensuring high quality installations in the whole country. A perhaps scarier aspect of compliance is the pressure and threats from a number of actors towards their customers with solar PV installs as we have seen coming from Eskom in recent months. Compliance is paramount to ensure high quality installs and general safety, less so if the aim is to discourage customers from investing in a much-needed technology.
Regulatory changes will define how smoothly South Africa navigates its energy transition.
Eskom is not out of the woods yet. Loadshedding is less, but Eskom’s financial situation is not sorted. Non-paying customers and municipalities, high investment needs as well as a serious debt burden means that Eskom needs to increase its tariff significantly going forward. This is bad news for the economy, yet alternative energy solutions are available to the public to reduce the negative consequences of these repeated increases. The good news is that these increases will lead to additional deployment of sustainable energy solutions such as solar PV systems of all sizes.
Will solar prices keep declining? 2024 saw a sharp decline in solar component prices, especially solar panels and batteries. This was the result of a number of factors, including overcapacity on the manufacturing side, falling raw material prices, overstocking and technological improvement. The balance between demand and supply should start normalising in 2025. We believe that prices for most key components will keep going down this year, yet not as quickly as in 2024. An underperforming currency as well as increasing install fees and maintenance can however threaten this continued cost reduction.
Will sustainability matter more in 2025? Getting solar was a no-brainer due to loadshedding. Users have then turned to savings to justify the transition to solar. Will sustainability be the next driver? An early sign that this is taking place is the recent news that a number of environmental groups are taking government to court for repeated violations of air quality standards. These violations are one of the reasons why loadshedding is no longer the priority concerns for most South Africans. The outcome of this case will be an important indication on how we can expect the energy space to evolve in the future.
South Africa’s energy sector is at a turning point. As costs fall, technology evolves, and infrastructure and regulations adapt, 2025 presents a golden opportunity to revolutionise how we produce, manage, and consume energy. It is so exciting to be part of this journey; from making solar energy more accessible to helping businesses navigate the transition to renewables, we’re here to drive South Africa’s energy revolution.