The wind energy market in South Africa is expected to grow at a CAGR of more than 3% during the forecast period of 2020-2025. Factors, such as increasing population and rising power demand, along with auctioned projects for wind energy during 2017-2019, are going to drive the market in the forecast period. With auctions for multiple projects and ambitious goals to achieve in the future, South Africa is investing significantly in the growth of wind energy. On the other hand, the high initial cost for wind energy installation, development of new grid networks, and delays in new projects are expected to restrain the market.

  • South Africa has installed more than 2000 MW capacity of wind energy by 2019. With more than ten projects under construction and planning stage, the wind energy market in the country is expected to grow during the forecast period.
  • According to the International Energy Agency (IEA), electricity generation from wind energy in South Africa is expected to reach 81 TWh by 2040, which is anticipated to create ample opportunities for market players in the coming period.
  • With the Integrated Resource Plan of 2019, South Africa is aiming to install 1600 MW of wind energy each year till 2030, which, if achieved, is expected to drive the wind energy market of South Africa considerably.



Key Market Trends

Wind Energy Contributing Significantly to Nation’s Grid

  • Wind Energy in South Africa has shown a robust growth from 2014 to 2019. With 570 MW in 2014 to 2070 MW in 2019, the almost four-fold increase has been witnessed.
  • In 20018, with the financial closure of two wind farms, 120MW Golden Valley and 32MW Excelsior, South Africa can break the three years stagnancy in the wind market and can drive the growth further.
  • With the involvement of international market players and rapid adaptation of renewables, the LCOE for wind has witnessed a significant drop, which is resulting in the growth of the wind market in the forecast period.
  • Wind energy is the dominant power generation source in renewables. With 5.9 TWh in 2017 to 6.9 TWh in 2018, wind energy produces more than 50% renewable energy in South Africa.
  • With upcoming projects and decreasing costs of wind power, considerable growth is anticipated in the future.



Government Initiatives and Upcoming Projects to Drive the Market

  • Considering South Africa’s renewable goals, International Energy Agency is estimating the wind electricity generation capacity to reach 12 TWh in 2025 and 81 TWh in 2040, which can bring a considerable growth in the power market of South Africa.
  • South Africa, with its Integrated Resource Plan 2019, is aiming to install 16000 MW of wind energy till 2030. If achieved, South Africa can become a major wind energy producer globally.
  • In 2019, Enel Green Power started the construction of two wind farms with a capacity of 140 MW for each. The plants are expected to be operational by late 2021, which will be adding a considerable capacity to the grid in the forecast period.
  • South Africa attracted USD 4.1 billion investment for renewables in 2018, in which wind energy took USD 2.7 billion, which is highest in the entire MENA region. With this, a significant surge can be seen in the coming period.
  • With active and bold initiatives by the government of South Africa, the wind energy market can be seen driving ahead in the future.



Competitive Landscape

The South Africa wind energy market is partially fragmented. Some of the major companies include Nordex SE, Vestas Wind Systems A/S, Electricite de France SA, Siemens Gamesa Renewable Energy SA, Enel S.p.A and others.

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