Over the next twenty years, South Africa will need to develop an additional approximately 52GW of new energy generation capacity to 2030. South Africa has world-class wind and solar resources by any measure that can contribute a significant element of this capacity. In so doing, it can simultaneously enable the development of the industrial capabilities to design and manufacture renewable generation systems, provide jobs, protect and enhance the competitiveness of exports in increasingly carbon-sensitive international markets and contribute to the country's energy security and so the basis for a robust and growing economy.
Renewables are more costly than traditional energy sources and will remain so for some time to come. The South African Renewables Initiative (SARi), established in early 2010 under the South African Government's Industrial Policy Action Plan, is tasked to design and establish a viable financing mechanism that would catalyse the critical mass of renewables needed to deliver economic and broader social benefits. Such a mechanism, in its current stage of development, would blend domestic commitments with concessionary resources and risk guarantee instruments channeled through inter-governmental co-operation. Provided within an appropriate institutional framework, such public resources would in turn leverage the far large sums required from private finance at an affordable cost to South Africa.