Solar solutions company Terra Firma Solutions chief business development officer Ben Snyman has said it would be a mistake to delay investing in a solar system to see if the price drops.  

“Solar costs have pretty much remained constant for the last five years. Prior to that, it was substantially more expensive but over the last four or five years, it's pretty much remained constant,” he said on March 29. 

Snyman, who was speaking at a webinar entitled ‘Energy War Room', which looked at smart energy solutions from members of the Reunert Renewables group of companies, said that, typically, a system payback could be as low as two years if owned outright.  

He noted that most solar systems were designed to last at least 25 years. 

“If you assume that, in year one, you have 100% of yield generated from the solar plant, and if you compare that to year 25, that solar plant will output about 83% to 84% as compared to year one. This means that your solar return on investment (RoI) outstrips almost any other business investment,” Snyman said.  

He added that the attractive business case was partly the reason why some of South Africa’s large property funds were increasingly rolling out solar power generation capacity at their various properties. This was not only to secure energy and reduce costs for their tenants and offtakers, but also because of the RoI, which Snyman said outperformed the typical threshold for these types of investments.  

“What you have to look at is how much would you have actually saved to date if you had pulled the trigger two to four years ago, as opposed to waiting for the price to drop,” he said. 

He also warned of solar purchasing decisions being taken based on the cheapest pricing alone. While the solar market in South Africa is regulated, solar installers in the market are not governed.  

"You don't necessarily need to be a highly qualified electrical engineer to design solar plants, and this has opened the door for a lot of smaller companies going out in the market and convincing potential clients of savings and benefits they could look forward to but are not necessarily going to receive,” he said. 

He also warned that solar providers might try and sell customers the biggest plant they can, but that the customer ends up paying for a very large solar plant, where they then either have to throttle the output of the plant or siphon energy off into the grid. 

“Typically, what you'll see is that clients will be presented with a 1 MW system for their own use and ownership, but then when those same companies are asked for a power purchase agreement, then all of a sudden the system size changes,” Snyman mused.   

He noted that, when buying solar systems, there were additional features that were often overlooked that needed to be considered. One feature he mentioned was bifacial modules, which allowed solar panels to pick up the radiation either directly from the sun or from reflecting irradiation from the ground below.  

Snyman also mentioned tracking systems that follow the sun as it rose in the east and it set in the west, thereby increasing energy yields.  

Business research firm EE Business Intelligence MD Chris Yelland said the energy crisis in South Africa had thrown the country into crisis owing to energy insecurity and spiralling costs. 

For investors, electricity decarbonisation and security of supply are increasingly being scrutinised as leading investment indicators, he said.  

“For customers, the pass-through impact of energy costs on product prices is pushing customers to consider alternatives. This is significantly impacting the competitive positioning and sustainability of businesses,” he said. 

Yelland noted that the average South African business was bracing for Eskom price increases and incurring more costs from backup diesel generators, forcing many into crisis mode as they attempt to devise solutions to mitigate the impact. 

The webinar was aimed at presenting financial and technology-based solutions that could be leveraged, including wheeled green power supply, embedded generation, smart load control systems and industrial-scale battery systems. 

These options allow companies to switch out of Eskom coal-based supply for green supply and hedge the power price, offset grid-based demand, reduce demand charges and use industrial scale batteries to buffer out loadshedding and provide energy arbitrage solutions. 

“These solutions are being embraced by businesses in South Africa today to improve their competitive positioning and ensure their company’s sustainable future. Virtually every country in the world has successfully ensured security of supply without regular loadshedding and there's absolutely no reason whatsoever why South Africa should not be able to achieve this as well – provided we do the right thing for a long time,” Yelland said. 

Energy transition solutions provider Apollo Africa MD Jenna Harris said some businesses had a knee-jerk reaction and wanted to disconnect from the grid entirely. However, she warned that, although energy prices continued to rise and supply remained unreliable, Eskom power was still the cheapest form of on demand energy available. 

"You should stop panicking and make a sensible plan. Optimise your demand, economically minimise your credit lines and gauge your power prices,” she advised. 

Electrical components manufacturer CBI energy management systems executive Roger Hislop said the first step was to create savings.  

“You want to understand your consumption. You need to do some granular metering. You need to be able to look at your trends, look at your capabilities and all your capacity in terms of delivering and consuming the energy, and then create an energy organisation chart that shows you where the energy comes from, from your points of supply, and where does it go to," he said. 

Through this, one could ensure that the energy supplied and the energy consumed added up, thereby minimising losses.