South Africa imported $1.1 billion (4.4GWh) worth of lithium-ion batteries in the first six months

Some analysis from Gaylor Montemasson-Clare, a senior economist at Trade, Industrial Policy and Strategy (TIPS) in Johannesburg, shows that South Africa imported $650 million (R12 billion) worth of solar panels in the first six months of 2023. Gaylor added that this is equivalent to 2.2GW of solar panels.

Now, Geller’s latest figures show that during the same period, South Africa imported $1.1 billion worth of lithium-ion batteries. That’s $1.1 billion worth in the first six months of 2023 alone! If we use the current bulk order price estimate of $250/KWh for stationary energy storage systems, this means South Africa imported about 4.4GWh of lithium-ion batteries in the first six months of this year. Geller added that this is a huge leap from the $700 million worth of batteries imported in the whole of 2022, and five times the $200 million worth of imports in 2021.

Many of South Africa’s coal-fired power plants are now quite old. As a result, plant failures are common, and Eskom, the country’s national electricity utility, also has a significant portion of its fleet scheduled for maintenance and tune-ups to improve the performance of some of these ageing plants. This has resulted in South Africa experiencing its worst ever period of power rationing, known as load shedding. Eskom’s load shedding program is implemented in “stages,” where Eskom removes a certain amount of load from the grid to stabilize the grid, rather than all at once. Depending on the severity of the crisis, load shedding is implemented in stages from Stage 1 to Stage 8, where Stage 1 removes 1,000MW of load from the grid, while in Stage 8, Eskom removes 8,000MW of load from the grid. Load shedding is implemented on a rotating basis of either 2 or 4 hours, depending on the severity of the crisis. However, Stage 8 means that most consumers will experience a power outage of around 12 hours. This year alone, South Africa has experienced more load shedding than in the past 5 years combined. As a result, South Africa needs to add new generation capacity as soon as possible.

It is great to see the growth of distributed and utility-scale solar PV in South Africa, which is rapidly adding some important capacity to the country's energy mix. However, due to frequent power outages, battery energy storage installations for residential and commercial industrial applications are booming as South Africans are in desperate need of support for their homes and businesses during power outages. The deployment of batteries adds critical grid flexibility.

So South Africa spent $650 million importing solar cells in the first six months of this year, and then spent another $1.1 billion importing lithium-ion batteries. That’s $1.75 billion in just six months! This has led to some big discussions about how to localize this ecosystem. There are several companies in South Africa that import solar cells and then assemble the solar panels. The same is true for stationary battery storage. There are several companies that import lithium-ion cells and assemble the battery packs for the local and export markets.

(Original source: Clean Technology Global Energy Storage Network, Global Lithium Battery Network, New Energy Network Comprehensive)