The growth in rooftop solar is expected to recover in 2025 – fuelled by rising electricity tariffs, ongoing energy insecurity and an oversupply of solar panels. The affordability of solar energy will also play a significant role in its adoption.
Industry associations have reported that demand for rooftop solar dropped sharply in 2024. According to the South African Photovoltaic Industry Association (SAPVIA), project volumes declined by 60% and 80% compared with 2023.
Despite this, the sector’s outlook remains positive. South Africa’s installed solar capacity is projected to rise from 6,68 GW in 2024 to 11,03 GW by 2029. Private solar PV capacity has also grown remarkably since 2022, rising from 2 264 MW in July 2022 to 6 165 MW by October 2024, SAPVIA reports.
Although growth slowed in 2024 compared with the exponential surge in 2023, the year was still highly successful for the solar industry. “It was the second best year the industry has seen, with around 1 GW of rooftop solar installed in 2024, compared with 2,6 GW installed in 2023,” says Andrew Middleton, CEO of GoSolr.
There was a slowdown in the residential market, contrasting with the longer-term strategic view of businesses. “The residential market tends to react to immediate circumstances. Demand spikes during periods of load shedding but decreases when Eskom’s electricity supply stabilises,” says Middleton.
There have also been significant price reductions in solar components over the past year, enabling the industry to offer more competitive pricing. “We’ve seen substantial reductions in the cost of solar panels, batteries and inverters in dollar terms. These prices are expected to remain stable unless major technological breakthroughs, such as battery chemistries like sodium-ion technology, lead to further cost reductions,” Middleton says.
Solar component pricing trends are beginning to follow a pattern similar to Moore’s Law with prices decreasing approximately every 18 months. “Last year, oversupply of solar panels in South Africa created short-term pricing benefits for consumers. Moving forward, we anticipate continued decline in long-term dollar prices,” Middleton says.
Regarding feed-in tariffs, he points out, while these tariffs can encourage the adoption of solar energy, most municipalities have not yet finalised their feed-in tariff structures. “Consumers also face upfront costs for meter upgrades, which can take years to recover before they see financial benefits from feeding power back into the grid,” Middleton says.
Currently, 80-100 of South Africa’s 257 municipalities (local and district) have rules, regulations and tariffs allowing grid feed-in, says Jack Radmore, GreenCape’s Energy Programme Manager. “Several organisations are collaborating with municipalities to establish the necessary frameworks for grid connections and feed-in tariffs.”
Middleton also notes a shift in consumer preferences with subscription and rent-to-own solar options gaining popularity over outright purchases. He anticipates strong growth in rooftop solar adoption. “Historically, back-up power was the primary motivation for adopting solar. However, due to its affordability, solar has become the preferred energy source internationally. In South Africa, generating solar power is often cheaper than purchasing electricity from most municipalities,” he says.
“Solar is already the second largest energy source in South Africa. Our vision is for every home in South Africa to have the ability to generate some of its power from the sun.”
