From Ethiopia to South Africa, millions of people are getting access to electricity for the first time as the African continent turns to solar, wind and hydropower projects in attempts to boost generation capacity. But did you know that South Africa’s Western Cape province is proudly home to some of Africa’s earliest renewable energy manufacturing initiatives and financing?
This early support of, and investment interest in, the alternative energy sector here has driven South Africa to become a leader in the continent’s booming “green economy”. In fact, Cape Town was the first to implement a sustainable energy strategy, set a policy for solar water heaters, and also was quick to set renewable energy targets, which were already at15% by 2014.
“Africa has one of the best potential resources of renewables anywhere in the world” Paolo Frankl, International Energy Agency (IEA)
Cape Town is well-positioned as an active renewable energy region within the African continent and supplies both imported and locally manufactured components. This has attracted investments by companies such as GRI. It has also contributed to the region fast becoming a knowledge hub for technologies and advancements in greener operations.
Foreign interest & local greentech innovations
Foreign direct investment in the renewable energy sector here amounted to ±R7.4 billion between 2008 and 2018. This investment came predominantly through the electricity (42.2%) and sales, marketing and support (40.1%) sub-sectors. The manufacturing sub-sector also observed an FDI inflow of 14.7% of all FDI inflows into the Renewable Energy sector during this period.
Locally developed smart meters are also enabling a host of utility advancements. Not to mention that many significant embedded generation installations have already been constructed in the City of Cape Town, as well as the larger Western Cape province. It’s also the first city in the country to implement an embedded generation tariff approved by the National Energy Regulator of South Africa (NERSA), leading the way for new utility business models.
Competitive advantages of the renewable energy industry in Cape Town
Cape Town forms part of a region which has become renowned as Africa’s renewable energy and greentech hub. The Western Cape has cultivated a strong presence of leading renewable energy companies and innovations. This has in turn already attracted a number of professional services and financiers to the sector here. Furthermore, notable competitive advantages also include:
- Notable market opportunities for businesses and investors across the agriculture, energy services, solar, wind, waste, water, bio-economy and resource efficiency streams.
- The region’s ability to provide businesses and investors with prime locations, modern infrastructure, a skilled workforce, low operational costs and an abundance of natural resources.
- An ease of doing business where the green economy is a key priority. This is complemented by five universities here, each offering established research and development capacity, as well as dedicated streams of study in the realm of the green economy and the embedded energy market.
- Cape Town’s reputation for being a knowledge hub for the green economy. In fact, it now accounts for approximately 71% of the Western Cape’s economy and houses most of the large, energy-intensive industrial areas.
- A number of very attractive investment incentives that are available through the Atlantis Greentech SEZ. The designation of this, in particular, has made the city even more appealing for investors in the renewables manufacturing industry.
The Atlantis Greentech SEZ & the renewable energy sector
As a result of decreased technology costs, especially for solar photovoltaics, the local embedded generation market has seen significant growth. As such, a large number of renewable companies in the region have established head offices in the city to be close to clients. However, the biggest drawing card to the City of Cape Town has by far been the establishment of the greentech manufacturing hub in Atlantis in 2011. This was in response to the government’s focus on localisation of manufacturing as part of the Department of Energy’s Renewable Energy Independent Power Producer Programme (REIPPPP).
Over the past decade, the city has made tracts of land available at low cost for purchase or lease by greentech companies through an accelerated land disposal process. A number of other ﬁnancial and non-ﬁnancial incentives are also on offer, including discounted electricity and rapid turnaround on development applications.
Investing in the Cape Town renewables sector
We’re able to assist with all of the information you’ll need in order to decide regarding Cape Town as a destination for your “green economy” enterprise or investment. Together with the city’s Atlantis Investment Facilitation Office, we’re also able to assist you with access to permit and licenses applications, as well as planning and development approvals, incentives and even ﬁnance.
Don’t miss this opportunity to explore the exciting prospects available in Africa’s green economy hub. From water efficiency to utility-scale enterprises and even waste management initiatives, Cape Town’s renewables landscape is virtually limitless. Contact us for even more information!