For homeowners willing to start small, solar is very reliable and economically feasible. (123RF)Systems such as the Tesla Powerwall are bringing solar energy to homes
with great style and panache, but is it a trend for South Africa?
In one of the funniest moments of The Simpsons, the family patriarch Homer admonishes his daughter for building a perpetual motion machine that keeps going faster.
“Lisa, in this house, we obey the laws of thermodynamics!”
It’s a joke that works on many levels, not the least that if anyone could develop a perpetual motion machine, they would become ridiculously wealthy. In fact, they would change the world entirely. The global appetite for energy is not just insatiable, but growing in leaps and bounds. Even as new efficiencies carve away demand, these are being replaced by new levels of consumption. For example, an electric car saves a lot of fuel, but places extra pressure on electricity providers.
This has ignited a once-small solar industry, where prices have been dropping hand over fist. In the last two years alone, over 300MW – solar for roughly 60 000 homes – has been installed, according to estimates from the SA Photovoltaic Industry Association (SAPVIA). But nothing quite heralded solar’s time than when Elon Musk, innovation posterchild, announced battery packs for homes called the Tesla Powerwall, then later roof tiles that double as solar panels.
But as with all cutting-edge consumer products, the price tag for these systems isn’t small.
In a country where sunshine is one of our most abundant resources, but our economy is not exactly aligned with the the 'eco bling' of the Tesla crowd, what does the picture look like for high-end residential solar?
Solar vs. the Joneses
The natural place to start is Tesla, represented locally by distributor Rubicon. According to Nick Roche, technical director at Rubicon, around 150 Tesla Powerwall units have been sold and installed in the country.
That may seem low, but with kit prices starting at more than R116 000 it’s actually a significant amount. Still, that means only a select clientele are able – or perhaps convinced – that spending so much is worth their while.
Not all solar solutions would cost that much. In fact, comparing alternatives on the market to the Powerwall is a case of apples and oranges. The Powerwall, now in its second generation, uses lithium ion batteries, which are considerably lighter than traditional lead acid batteries. There are benefits and drawbacks to both, but the fairly new status of lithium ion in the solar world is part of the higher cost.
The benefit the Powerwall has is its turnkey nature, when compared to many other solar installations, it's relatively elegant and simple. But that reflects in the cost. You could call the Powerwall an early pioneer of ‘plug and play’ solar, a field slowly being filled by competitors such as Mercedes and LG.
Those two companies didn’t respond to interview requests, but Rubicon was happy to give its views. Does the high price add any value to homes? Roche says: "Beyond the actual financial return of such a battery tied to photo voltaic (PV) over its life, it seems that there is perceived additional value in the backup capability, green merit and lifestyle contribution. I know of several houses that have been sold at prices above the expected market value-plus-solar system cost, apparently due to the perceived additional value of the PV system.”
Solar’s challenges
Some argue that products such as the Powerwall may struggle in the country due to the state of the market itself. According to Mikhail Nikomarov, CEO, Bushveld Energy, South Africa lags behind countries such as Australia: “To some degree, we still have comparably cheap average electricity tariffs (if only pure exchange rate numbers are used), but the structure of the tariff, where many residential consumers don't have a time of use tariff or the difference between peak and off-peak is minimal outside the winter months, makes it an impossible business case. Thus, those that buy such products (as the Powerwall) do it for pleasure or status and not because it’s viable economically.”
Another variable flagged by some commentators is that many consumers still believe their solar investment could pay for itself by selling power back to the grid, a practice called embedded power generation (EPG). Some municipalities, such as the City of Tshwane, have announced plans to facilitate this. But this is a complicated issue and also relates to whether people want to go off the grid. Nonetheless, those who want to sell energy back are less likely to see batteries – still among the most expensive components in solar – as an investment.
Solar is growing in South Africa, according to the South African Photovoltaic Industry Association, though not as prolifically as when Eskom’s rolling blackouts caused a panic around electricity availability.
“I don’t necessarily think PV installations are being held back. It has been growing over the last number of years,” says Stephen Koopman, R&D outcomes manager: Energy Centre at the CSIR. “But there are factors delaying the growth of solar PV rooftops. For example, the absence of a wiring code at low voltage levels for solar PV installation can be one. Some municipalities have gone beyond this and put in some mechanisms to ensure safe installations.”
He adds that more EPG programmes could accelerate demand. Standards are also improving: after a number of problems emerged around the installation of solar geysers, the local PV industry has been forced to mature considerably. In fact, for homeowners willing to start small, solar is very reliable and economically feasible. At a large commercial and industrial scale, including residential complexes, solar is attracting attention.
From a channel point of view, the solar game is still wide open. Though it's too early to declare that eco bling may create a new industry of PV-supplying Richemonts and Louis Vuittons, South Africa’s brush with load shedding has pushed it over the first hump towards industry maturity. As the economics of solar start to show themselves – a square metre panel in South Africa can harvest 6kWh of energy a day – and more EPG programmes, adoption will pick up.
The SAPVIA says solar is a rapidly growing market locally. Maybe one day there will be a Powerwall at every Dainfern and Camps Bay address, complete with designer solar tiles. But for now, let’s aim for a solar panel on every roof in Soweto.