Solar surge leaves Eskom chasing billions in lost revenue
South Africa's solar boom is cutting into Eskom revenue as households and businesses turn to self-generation amid high electricity costs.
Eskom is facing a revenue shortfall of over R50 billion annually due to the surge in off-grid solar power installations, with suburban rooftop systems now making up 20% of the country's total electricity generation capacity. By year-end, rooftop solar is expected to surpass 10GW, while overall solar generation is projected to reach 12GW, according to industry experts.
At a typical consumer charge of between R2.5 and R3 per kWh, Eskom stands to lose between R44 billion and R52 billion. Initially driven by Eskom's grid instability caused by load shedding, solar power is now proving to be a cost-effective solution for many South African households. Sim Khuluse, technical and policy manager at the South African Photovoltaic Industry Association, emphasizes that South Africa now boasts over 11.8GW of cumulative installed solar PV capacity, positioning the nation as Africa's leading solar market and among the top 20 globally.
The planned nuclear power plant, proposed for the ecologically sensitive Eastern Cape coast, appears less justifiable in terms of energy security given the significant impact of solar on grid capacity. The Integrated Resource Plan 2025, approved by Cabinet last October, earmarks 5,200MW of new nuclear capacity by 2039. However, with the upcoming Revised Electricity Pricing Policy, questions will arise regarding how Eskom intends to recover the R50 billion lost to solar.
Electricity and Energy Minister Kgosientsho Ramokgopa stated that the new policy aims to bring fairness and transparency to electricity pricing, though he acknowledged that current tariff increases include a few percentage points to offset Eskom's debt to municipalities. Energy analysts argue that Eskom must win back customers who have already invested heavily in solar, batteries, and generators to reduce their reliance on the national grid.
The issue of customers being penalized by Eskom and government for challenges the state should have addressed has been ongoing for over a decade, prompting many to seek more affordable alternatives.
Written by urgent.news from The Citizen's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
