Mervyn Naidoo | CEO | ACTOM | mail me |
Africa’s energy demands are surging, driven by rapid population growth and industrial expansion. Industries are now frantically seeking reliable and affordable power alternatives to run their operations. However, the current reliance on imported solar technology, from panels to inverters and batteries, leaves the continent vulnerable.
When global supply chains hit a snag, repairs get delayed and components become scarce. As a result, the entire system falters. This setup is fragile, plain and simple, and one that Africa can no longer afford to rely on. Therefore, the prospect of building inverters and lithium batteries locally, designed for South Africa’s specific needs, is incredibly promising.
Securing Africa’s energy future will depend heavily on reducing this overreliance on imported technologies and building robust, self-sufficient energy ecosystems. In stimulating domestic production, industries can tackle two major challenges. These include increasingly erratic grid access and spiralling energy costs.
At this point, local production is no longer just a golden opportunity. It is a vital necessity if the continent is to meet its ever-expanding energy needs.
Making a compelling case for localisation
South Africa, a microcosm of the continent’s energy struggles, illustrates the point perfectly. The nation’s ongoing battle with load shedding stems directly from Eskom’s inability to meet growing demand. This challenge has triggered a phenomenal rise in solar energy adoption.
Rooftop installations now account for an estimated six gigawatts of capacity alone. When combined with concentrated solar power, the total solar capacity reaches around nine gigawatts. This shift is not driven by load shedding alone. Municipal infrastructure delays, which result in extended outages lasting days, have intensified the need for independent power solutions.
In just the first 50 days of this year, some industrial zones experienced 20 to 30 days without electricity. This underscores the sheer scale of the crisis.
Meanwhile, the global context adds a further layer of complexity. The world is rapidly advancing a renewable energy agenda to combat climate change and push decarbonisation. This global transition has caused a massive surge in demand for components. These include solar panels, batteries and high-voltage transmission equipment. As a result, supply chains are overwhelmed and lead times have stretched significantly. For example, lead times for large transformers in Europe now exceed three years.
Finding strategic advantage in microgrids and domestic manufacturing
Against this challenging backdrop, localised manufacturing of inverters and lithium battery solutions is no longer optional. It has become essential. South Africa’s escalating electricity tariffs, which continue to rise at an alarming rate, make off-grid solutions more economically feasible.
The cost of a standalone solar and battery system is approaching parity with municipal tariffs. This shift can drive demand and create the economies of scale needed to support local production. The benefits of localisation are not limited to cost savings alone.
By localising component manufacturing, countries can create jobs, grow the economically active population and generate tax revenue. These changes stimulate broader economic growth and reduce the state’s social burden. Such an approach aligns with national goals of addressing unemployment and inequality.
Moreover, microgrid technologies offer a powerful strategic advantage. These decentralised energy systems are more than just a supplement to central grids. They are a lifeline for a continent whose total generation capacity is just 10% of China’s, despite having a comparable population. This staggering disparity makes it clear that vast areas of Africa lack reliable power.
Microgrids can operate independently from central grids. This makes them ideal for delivering electricity to remote and rural communities where traditional infrastructure is not feasible. This is how villages, schools and small businesses can gain access to consistent power.
Electrification will energise local industries, support small-scale manufacturing and enable cold storage for agriculture. Most importantly, it will open the door to digital education. These developments can serve as true catalysts for economic activity and transform marginalised regions into vibrant economic hubs.
By deploying localised energy systems, Africa can significantly increase its overall generation capacity over time. This gradual but determined shift from dependency to self-sufficiency is key to securing Africa’s energy future through sustainable development.
Building Africa’s energy independence – feasibility and benefits
Setting up a fully localised supply chain will require deliberate planning and investment. Currently, intercontinental trade within Africa remains low — below 20%. However, the African Continental Free Trade Area (AfCFTA) offers a path to change that. It can help unlock the economies of scale necessary for large-scale manufacturing.
By 2050, Africa’s population is expected to exceed 1.5 billion people. This presents a vast and growing market. The continent also possesses abundant raw materials, including copper, lithium and iron ore. These resources can support the establishment of regional industrial hubs, focused on localising production across the continent.
Developing local production capabilities will speed up repair times and improve access to critical components. Technology transfer will further allow local manufacturers to support products throughout their lifecycle. This will reduce reliance on imported parts and enhance plant availability and system reliability.
The failure of the Transnet 1064 locomotive programme demonstrates the risks of relying solely on imports. The absence of technology transfer left locomotives idle and resulted in billions of rands wasted. Therefore, securing Africa’s energy future will also require building in resilience, innovation and technical skills within local industries.
Taking steps toward a sustainable energy future
The economic and technological advantages of a domestic renewable energy industry are both clear and compelling. Increased employment and higher tax revenue stimulate economic growth. Simultaneously, technology transfer builds local expertise and encourages innovation.
Transitioning to localised and decentralised energy systems is one of the most effective ways to reduce dependency on foreign solutions. This shift ensures long-term energy security. In this context, building local energy systems is not merely an opportunity, it is an essential step in securing Africa’s energy future.
Africa’s population is young, with an average age of just 20 years. This represents enormous workforce potential. However, to unlock this demographic dividend, Africa must industrialise. And that industrialisation depends on one thing above all: access to reliable, affordable energy.
Therefore, the localisation of manufacturing, the creation of economies of scale and the transfer of technology are not optional. These are foundational to energy independence and sustainable economic growth.
Through smart planning, strategic investments and continental cooperation, Africa can move from energy dependence to leadership. This is the path to securing Africa’s energy future.
