AI Governance
Data Centers
Drones
Climate
Privacy
2026 Maine Senate
Bob Dylan
Private Power Rewires South Africa
Coverage from Africa Sustainability Matters, Pinsent Masons, and others
South Africa’s energy transition is increasingly being financed by private companies, with corporate power purchase agreements expected to support most new utility-scale solar and wind capacity in 2026.
The shift is occurring alongside continued coal dependence and a major need for transmission expansion, which could determine whether renewable growth delivers broader industrial benefits. Chinese investors and manufacturers are also becoming important partners in equipment supply, infrastructure, and emerging green-fuel projects.
If you read one thing
It provides the clearest overall account of private-led renewable growth, transmission constraints, coal dependence and industrial competitiveness.
Best explainer
It explains how Chinese investment, transmission expansion and emerging green-fuel projects could shape implementation of the transition.
Corporate buyers are becoming the main renewable financiers
Corporate power purchase agreements are expected to support 73% of South Africa’s 2.3 GW of solar and wind additions in 2026, overtaking government auctions for the first time. This shifts renewable expansion toward private procurement and corporate demand.
Transmission is the binding constraint on wider transition gains
Developers and corporate buyers are planning additional clean-power investment, but insufficient transmission capacity threatens project connections and the industrial benefits of renewable growth. The state’s plans include roughly 14,500 km of new transmission lines by 2034, making delivery a critical dependency.
Coal still dominates, despite a planned long-term shift
Coal supplied 78% of South Africa’s electricity in 2025, so the transition remains heavily dependent on the retirement and replacement of ageing coal capacity. Policy targets and transition scenarios point to declining coal use, including 8 GW of retirements by 2030 and a possible 21% coal share by 2050.
High costs and external supply dependence limit industrial gains
South Africa’s clean-industrial ambitions face electricity prices substantially above mainland China’s and heavy reliance on Chinese solar and battery imports. Chinese manufacturers are being courted for local equipment production, but the evidence presents localization as an objective rather than an achieved outcome.
35% percent
increase in small-scale solar investment
“South Africa attracted US$5.4 billion in renewable-energy investment in 2025, remaining sub-Saharan Africa’s largest market. Investment declined 41% from US$8.6 billion in 2024. Utility-scale solar investment fell 57% to US$1.4 billion, onshore wind investment declined 30% to US$2.1 billion, and small-scale solar investment rose 35% to US$1.8 billion.”
57% percent
decline in utility-scale solar investment
“South Africa attracted US$5.4 billion in renewable-energy investment in 2025, remaining sub-Saharan Africa’s largest market. Investment declined 41% from US$8.6 billion in 2024. Utility-scale solar investment fell 57% to US$1.4 billion, onshore wind investment declined 30% to US$2.1 billion, and small-scale solar investment rose 35% to US$1.8 billion.”
95% percent
share of South Africa’s battery imports supplied by Chinese manufacturers
“South Africa is also becoming dependent on China, whose manufacturers supplied 98% of the country’s solar imports and 95% of battery imports in 2025.”
R1,652 per megawatt-hour rand per megawatt-hour
average industrial electricity price
“Average industrial electricity prices were R1,652 per megawatt-hour in 2025, compared with R964 per megawatt-hour in mainland China.”
78% percent
share of electricity supplied by coal
“Coal supplied 78% of South Africa’s electricity in 2025, down from 90% in 2015. Under BloombergNEF’s Economic Transition Scenario, electricity consumption rises 35% to 319 terawatt-hours by 2050. Solar, wind and battery storage would supply 69% of demand, while coal’s share would fall to 21% as aging plants retire.”
No new-member articles were supplied, so there is no evidence of a material change in South Africa’s energy transition.
Previously
South Africa’s energy transition is increasingly being financed by private companies, with corporate power purchase agreements expected to support most new utility-scale solar and wind capacity in 2026. The shift is occurring alongside continued coal dependence and a major need for transmission expansion, which could determine whether renewable growth delivers broader industrial benefits. Chinese investors and manufacturers are also becoming important partners in equipment supply, infrastructure, and emerging green-fuel projects.