South Africa’s solar panel market is experiencing a surprising downturn after a record-smashing start to the year, recent figures from the South African Revenue Service (Sars) reveal. The meteoric rise in solar imports, which saw an influx of panels, inverters, and batteries, has faced a sudden eclipse in the past few months.
Solar Surge Hits a Sudden Slump
The first two quarters of 2023 painted a sunny picture, with the import value of solar panels alone reaching an impressive $651 million (R12.1 billion), dwarfing 2022’s total of $345 million (R6.42 billion). Yet, as demand wanes, the solar market is showing signs of cooling off. Gaylor Montmasson-Clair of Trade and Industrial Policy Strategies highlighted the stark contrast in the latter half of the year, with August imports dwindling to R1.15 billion — a sharp fall from May’s peak of R3.25 billion.
What’s Behind the Darkening Skies?
Solar installers have cited several reasons for this downturn:
- Economic strain is taking its toll, as consumers grapple with rising costs of living.
- The easing of load-shedding has dampened the urgency of ‘grudge’ purchases.
- A flood of counterfeit panels mid-year has sown seeds of doubt in the market.
An Unprecedented Low in Solar Pricing
Despite financial pressures, solar technology prices are hitting record lows globally. AWPower’s Christiaan Hattingh reports a dramatic 40-50% drop since early 2023. This price plummet, fueled by a glut in the global supply and a crackdown on counterfeit goods, has yet to spur a resurgence in consumer interest.
While the current slowdown is notable, the overall value of 2023 imports still eclipses those of prior years. With a total of R15.93 billion in imports tallied by August, even a modest uptick in the remaining months could see annual figures quadrupling those of 2022. Despite halved prices, the volume of panels passing through customs suggests a substantial year-on-year increase in actual units imported.