The growing trade of solar power by independent power producers (IPPs) is playing a pivotal role in South Africa’s rapidly deregulating electricity market, says digital solutions provider for energy markets Enerweb. By diversifying the energy mix and increasing competition in the power sector, solar trading is “setting the stage for a cleaner, more cost-efficient grid”.

“Trade in solar energy has laid the groundwork for a more open and competitive electricity market, shifting away from a single-buyer model towards a dynamic, multi-actor environment that supports competitive pricing,” says Enerweb CEO Santego Govender. 

He notes that, while solar power offers significant advantages, its weather-dependent variability makes it difficult to consistently match supply with demand. The rapid rise of large-scale embedded solar will exacerbate grid congestion, which can negatively affect operations and supply reliability for customers.

However, Govender emphasises that these challenges can be efficiently addressed through smart deployment of technology, including the deployment of battery energy storage systems (BESS), which enable solar power to be dispatched when the sun is not shining, reducing intermittency and enhancing reliability.

He adds that another promising development is the rise of virtual power plants (VPPs), where distributed energy resources, such as rooftop solar and BESS, are aggregated and integrated into the grid. By participating in VPPs, end-users can further enhance the reliability and dispatchability of solar power, ensuring stable supply.

Benefits for Business, the Economy

Beyond technical advancements, trading in solar power holds an array of economic and environmental benefits for South Africa.

Trade among IPPs, traders and utilities leads to competitive pricing, lowering costs across the electricity market and ensuring reliable supply to minimise downtime for businesses and industry, says Govender.

IPPs that specialise in solar power trading can also assist businesses in reducing their operational costs by providing access to the inherently lower costs of solar energy, provided their demand profile aligns with solar production. They also allow users to reduce the reliance on carbon-based electricity, which could, in turn, improve the entity’s environmental, social and governance credentials– an increasingly critical factor for global export competitiveness, particularly in markets demanding “clean” energy.

“Solar trading speeds up the shift to a cleaner grid by giving renewables real market access and clear price signals. This allows solar to displace more carbon-intensive generation, especially during the day,” he states.

Digitalisation for Optimisation

For solar trading to realise its full potential, it is essential that IPPs ensure that their digital systems work hand in hand with their physical infrastructure.

IPPs and other grid electricity suppliers ought to ensure that their physical infrastructure, including smart meters, reliable grid connections and possibly even BESS systems are complemented by intelligent digital systems such as meter data platforms, forecasting tools, scheduling engines, predictive maintenance solutions, market portals and energy trading and risk management (ETRM) systems.

“From metering and forecasting to settlement and analytics, Enerweb’s technology stack is helping to unlock real participation in the market, positioning the company as a key enabler in South Africa’s energy transition.” The company has delivered ETRM systems across Africa and has created, and continues to support, core trading platforms such as the Southern African Power Pool (SAPP) and Eastern African Power Pool. It has also enabled private traders to participate in traditional wheeling–and soon, virtual wheeling– as well as regional trading through SAPP and is preparing customers for the South African Wholesale Electricity Market (SAWEM) next year. Enerweb’s products are all underpinned by advanced analytics for optimisation, risk management and planning.

“These systems help automate bidding, trading and settlement. They also ensure that everything stays compliant and transparent. At Enerweb, we sit right at this intersection, bringing together the platforms and tools that enable producers, traders and utilities to operate in a connected, scalable way.”

Govender warns, however, that technology alone is insufficient.

“Like the rest of the energy sector, we’re seeing a shortage of people who combine advanced IT skills with deep energy market knowledge. At Enerweb we are continually building our team to meet this challenge, ensuring we have the talent to match sector growth and market evolution,” adds Govender.

Outlook

Govender says the future looks “bright” for the trade of solar power in South Africa, with traders expected to play a significant role in driving growth in the country’s electricity market, adding to the expected positive impacts owed to the unbundling of Eskom, the increase of open access policies and evolving trading frameworks.

The planned introduction of the SAWEM is set to formalise this transition, offering a wholesale platform that integrates solar and, over time, other renewables into transparent, competitive markets.

He expects an increase in the value placed on data, digital integration and forecasting with exponential growth in bilateral over-the-counter trading of electricity. He also predicts an increase in participation of other traders for demand response and flexibility services as well as more hybrid models, incorporating BESS with solar solutions.

“In the longer term, an open regional electricity market would help unlock cross-border value and drive deeper emissions reductions across the continent. Enerweb continues to invest in the tools and the talent needed to support this transition,” Govender concludes.