Cost of solar panels drops 10% annually while Eskom prices increase

Although Eskom may have suspended load shedding and despite the fact some solar energy supplier companies are in trouble, the boom in this form of alternative energy is far from over, say experts.

In 2019, research by Sustainable Energy Africa found that there are financial and environmental benefits of moving from Eskom electricity to solar power through financing solar photovoltaic systems with storage through a home loan, which is a lot cheaper.

Energy experts agree that this is true even in 2024, with the lessening in load shedding.

ALSO READ: Eskom execs say end of load shedding close but two problems keep them up at night

Solar power more cost-effective

The research suggested that the cost of solar panels decreased by more than 10% annually, while Eskom’s prices are constantly increasing. This means it is more cost-effective to have a solar system, but solar power systems are not cheap.

Energy economist Lungile Mashele said the cost of solar installations is prohibitively expensive.

“Most people were taking out loans or making payments in excess of R100k just to afford the system. Others are tied into monthly contracts.”

Mashele said: “The cost of solar should not only be viewed through the lens of load shedding, but rather reducing your daytime electricity costs and meeting decarbonisation goals.”

A study by Green Cape, a non-profit organisation that drives the widespread adoption of economically viable green economy solutions, found that for 2024, a focus on renewable energy, energy services and electric vehicles are investment opportunities.

Solar panels, wind turbines, small solar panels on roofs and batteries, electric cars and buses are where the opportunities lie.

Green Cape has also suggested that if more people buy solar panels and wind turbines, people can generate more energy-efficient electricity by 2030, as suggested by energy economists.

Mashele said the intensity of load shedding and imports of solar panels is positively correlated. “This is why we’re seeing imports back to 2022 levels.

The spike we saw in 2022-23 was because of stage 4-6 load shedding.

“Given limited funds and competing resources, most people will align their budgets to their immediate needs.”

ALSO READ: How to escape electricity costs with solar

Getting the most out of it

The mitigation auditor at Solar Infrastructure Inspections and Maintenance, Lourentius van der Westhuizen, said their purpose is to mitigate risk while contributing to an energy-efficient society.

They inspect commercial buildings and state-owned facilities.

They have adopted thermal drone surveys to identify air gaps, poor insulation and leaks in a building to reduce energy costs.

“If you have leaks that we can pick up with a thermal camera and you are not optimally cooling your environment, you’re wasting money.

“So, we look at the complete picture. How do you become energy-efficient? We then issue an energy performance certificate which is valid for five years.”

He added that substandard solar systems also waste money because they need to be replaced and repaired regularly.

He does not consider the lack of load shedding a threat to solar systems, because it has not been completely resolved.

“Eskom tariffs are predicted to double within the next four years. In a proper solar installation, you will have a return on your investment and enjoy free power for the next four to five years.”

Van der Westhuizen added the closure of solar company Hohm Energy did not indicate the decline of solar.

“It was carrying too much stock and now not being able to cover the overheads and repayments to the financiers because of this period of non-load shedding.”

ALSO READ: ‘Quick is best’: Your long showers could be costing you thousands – study reveals