Page 39 - Energize October 2021

VIEWS AND OPINION

Residential investment in rooftop solar PV

The move away from centralised grid-supplied electricity is a significant step for sustainable
development. More and more households are installing rooftop solar photovoltaic (PV) systems to
generate their own electricity.

by Louise Scholtz , WWF South Africa and Karin Kritzinger, In practice this means increased investment in specific areas, putting
Stellenbosch University, CRSES the functioning of the overall electricity system at risk. This is
especially challenging when there is a concentration of unregistered
he worldwide cost of solar PV systems is falling, making such PV systems on distribution grids that do not have capacity to absorb
systems increasingly attractive to consumers. Households the excess electricity.
Tcan reduce their consumption of fossil fuel-based electricity, There is a cost to the system due to lost income. This impacts
the price of which continues to increase and decrease their carbon on the municipality’s ability to maintain the grid for the benefit of
emissions. If properly integrated into the municipal electricity grid, everyone. Municipalities can better manage the challenges if they
rooftop PV can help cities to attain their emission reduction targets. know where PV systems are connected to the grid and the size of
However, there are financial implications for municipalities, which these systems.
are responsible for the electricity distribution network and the sale of Municipalities buy electricity from Eskom and resell it to
electricity in their areas. The loss of income from electricity sales is a households. The more electricity sold, the higher the turnover. This
major challenge, especially as this revenue stream is used to maintain is used to cover the municipality’s fixed costs of the distribution
and invest in electricity infrastructure, subsidise free electricity to infrastructure and to subsidise other services.
indigent households and support other underfunded services.
How consumers and municipalities respond to the energy transition A decrease in electricity demand results in reduced sales. Municipalities
is critically important to ensure the reliable, safe and efficient provision can try to offset the reduction in income by:
of electricity and to the long-term financial sustainability of our cities • Raising their tariffs – but they can only do this on application to the
and towns. National Energy Regulator of South Africa on an annual basis; or
The findings of the WWF-SA survey discussed in this article, • Amending their tariff system to make provision for fixed connection
highlight the need for municipalities and households to work together charges; or
to ensure that those of us who live in cities and towns are not faced • Providing additional energy services for which they can charge.
with islands of electricity self-reliant households, surrounded by
income-strapped metropolitan areas. All three options require careful management because consumers
Also evident from the WWF-SA survey is that investment by are resistant to price increases and to changes in their tariff structure.
households in rooftop PV is highly dependent on disposable income. Wealthier residents consume more electricity than less affluent

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