Revenues for Southern Africa’s renewable energy equipment market could increase to $262,3-million by 2015, as the use of the renewable technologies could grow “exponentially” over the next couple of years.
Growth consultancy firm Frost & Sullivan highlighted on Tuesday that the renewable energy equipment market in Southern Africa had earned revenues of $28,4-million in 2008, a number which was set to increase nearly tenfold to 2015.
The firm noted that the renewable energy market in South Africa was expected to grow exponentially in the next few years following the announcement of the renewable energy feed-in tariff made in March.
“The growth of the wind power market and large-scale solar concentrating projects will be driven by an increasing number of joint ventures. Such ventures will be between project developers with local knowledge and private equity investment firms, backed by the support of international original equipment manufacturers,” said Frost & Sullivan energy analyst Sipha Ndawonde.
With tightening sources of global credit and more countries reporting negative economic growth rates, private equity investment companies have become more selective and strategic about the sectors into which they invest, he said.
Sustainable energy project portfolios have, however, bulged to more than $1-billion and were dedicated to financing renewable energy projects in Southern Africa.
“This is an indication that investors view renewable energy and energy efficiency projects in Southern Africa as having favourable returns and representing a solid investment decision,” Ndawonde noted.
He added that an abundance of natural resources, together with a stable political environment, reasonable economic growth rates and growing interest from private equity firms, meant that large-scale renewable energy projects were set to penetrate into the Southern African countries of South Africa, Botswana and Namibia.