SolarAfrica – South Africa’s innovator in renewable energy
SolarAfrica is a leading South African renewable energy company and Independent Power Producer that serves a wide range of organisations with affordable and accessible energy at scale.
When David McDonald and James Irons found themselves facing the same thing in South Africa that they had seen during their work on renewable energy projects in other parts of the continent – rapidly climbing power prices – they knew they wanted to be part of the solution.
And so, in 2011, what is today known as SolarAfrica was born. The company’s early days were focused on project-based finance, helping businesses gain access to funds for any form of ‘clean’ technology that had a promising outlook, such as biogas, biomass and more.
By 2014, solar energy had begun gaining global traction, driving down costs to get this renewable energy solution and making it increasingly accessible.
Recognising the commercial potential and scalability of solar, McDonald and Irons decided to pivot the business in that direction – rebranding it as SolarAfrica. At the time, the company consisted of a total of three staff members.
As the power crisis in South Africa ramped up, SolarAfrica started to roll-out its renewable energy solutions more widely, primarily for property developments, serving body corporates and developers.
In 2021, the South African government raised the licensing threshold for generation projects from 1 MW to 100 MW, allowing private sector participation in electricity generation in a bid to relieve pressure on the national grid. “This was a game-changer for solar, and the landscape seemingly shifted overnight”, recalls McDonald.
“Malls and other larger power users started to take solar more seriously, and in a very short space of time, the commercial and industrial (C&I) solar market quadrupled in size, which meant more demand, bigger projects and the need for more resources. And so, we started to focus more heavily on this sector of the market.”
Key projects
Today, SolarAfrica is a fully-fledged independent power producer (IPP) with more than 145 full-time staff members and has established itself as a South African leader in renewable energy.
Some of its key projects include building one of the largest solar carports in the world for Ford, and taking the Singita luxury lodge completely off-grid.
With rising interest in commercial solar, SolarAfrica recently embarked on arguably its biggest project yet – SunCentral.
SunCentral is a large-scale solar photovoltaic (PV) plant located between Hanover and De Aar in South Africa’s Northern Cape province; a three-phase project that will offer 1GW of generation capacity upon completion.
Unlike similarly sized projects that offer electricity wheeling on a one-to-one basis (with one generation plant supplying one off-taker), SolarAfrica’s project will offer wheeling on a one-to-many basis, making it available to a wider pool of businesses in South Africa.
The first phase of this project is already underway, with SolarAfrica securing the R1.8 billion in funding necessary to close on the first 114MW component of this project.
Going against the current
SolarAfrica has been attributed with revolutionising how power purchase agreements (PPA) are structured in South Africa.
Traditionally, a PPA would see a user paying a monthly minimum amount, regardless of whether they use the solar or not.
However, SolarAfrica recognised that this model could be prohibitive, as customers were forced to pay for power they didn’t use.
“Our customers have always been at the heart of our business, and we realised moving towards a consumption-based PPA would make more sense for many of our users.”
McDonald likens it to ‘pay-as-you-go’, with customers only paying for what they use. “If your business is closed over a weekend and you don’t consume solar, then you don’t pay for it.”
“This offered our customers relief on their electricity bills while allowing them to replace expensive utility power with solar.”
SolarAfrica has continued to positively disrupt the industry through its customer-centric offering and out-the-box approach, including its imminent move towards shorter, more flexible contracts.
“Long-term power purchase agreements – once the industry standard – are no longer a one-size-fits-all solution.”
“With today’s economic uncertainty, many businesses are rethinking 20-year commitments, so we’re introducing more flexible, shorter-term contracts to meet this growing need for agility.”
Another way it is innovating is through its introduction of aggregation, which grants agriculture customers in far-afield or rural areas access to cheaper, greener energy while minimising the administrative burden of multiple electricity bills.
“Through aggregation, we’re able to bring the benefits of wheeling, micro-grids and energy trading to rural farming communities, building sustainable power mini-ecosystems.”
“This gives these customers greater control over the power they use and cost savings, while allowing them to reinvest back into their communities.”
Says McDonald of the driver behind the company’s approach: “We’ve been able to scale by remaining firmly focused on our customers.”
“We’re highly attuned to our market, and as it evolves, we respond in a way that ensures our customers benefit.”
“Our customers remain at the heart of what we do, so we always ask ourselves how we can innovate and adapt to better serve them.”
“If we do PPAs, how do we design them in a way that will benefit our customers the most? If we build a solar farm, how can we structure it so that more C&I businesses can access its power?”
“We’re not just delivering power – we’re reimagining it. By unlocking cleaner, cheaper energy for our customers, we’re helping to fuel a greener, more energy-secure South Africa.”
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