Roadmap for diversifying SA’s energy mix

South Africa’s energy transition requires careful consideration of realistic timelines and socioeconomic implications to strike a sustainable balance in the South African context. How can the country pragmatically solve its energy security crisis amid sustainability requirements, while supporting socioeconomic development and industrialisation? A white paper by management consultancy Kearney explains that South Africa must establish a diversified energy mix.

Kearney partner Prashaen Reddy, co-author on the white paper: Energy security and sustainability: striking the South African balance. All images supplied by Kearney

Establishing a diversified energy mix includes responsibly leveraging its regional endowments, such as coal and gas, while scaling up cleaner sources to reduce fossil fuel use—following a phased approach with realistic timelines. The authors of the paper are in attendance at the Africa Energy Indaba, taking place in Cape Town from March 4–6.

“Diversifying the energy mix in South Africa, however, does not come without challenge, with different clean technologies needing to overcome specific hurdles,” explains Kearney partner Prashaen Reddy.

“This will require a gradual approach with realistic timelines. Despite these challenges, various electricity sources offer promising opportunities to support energy security while enhancing sustainability, industrialisation, and socioeconomic development. These opportunities can be unlocked through pragmatic, integrated planning.

“The road map for establishing a diversified energy mix will take a blended approach, balancing the immediate need for energy security with long-term sustainability. Aligned to South Africa’s draft IRP 2023, Kearney’s road map offers a two-phase approach, set to grow and scale up, incorporating lessons learned internationally with pragmatic consideration of South Africa’s unique context,” says Reddy.

The white paper

The white paper explains there are two steps to follow.

Phase 1: Set to grow

Phase 1 builds on the current energy landscape. It ensures the efficient functioning of existing fossil fuel generation and grid infrastructure to support current energy security needs while preparing for the low-carbon future by introducing additional gas and renewable infrastructure.

The current coal fleet can provide a stable baseload and utilise South Africa’s coal resources for their remaining life of up to 45 years—planned decommissioning dates range between 2025 and 2069—should strong maintenance practices be established and upheld, while the necessary upgrades are implemented when required.

“As the bulk of South Africa’s existing energy mix, this is crucial to meet immediate energy needs until additional generation sources come online. However, it remains crucial to use coal responsibly and implement carbon capture technologies where feasible,” says Reddy.

Beyond generation, aging transmission infrastructure is also a persistent electricity problem in South Africa. Upgrading and strengthening maintenance of transmission and distribution infrastructure is vital to energy security, as it ensures energy can reach demand hubs.

Reddy’s co-author on the white paper, Kearney principal Frances Phillips, adds that maintaining current infrastructure and replacing aged infrastructure with resilient, future-focused infrastructure is key to stable energy access from current generation sources and enabling additional, diversified generation in the future.

Co-author on the white paper: Energy security and sustainability: striking the South African balance , Kearney principal Frances Phillips.

“Securing regional gas supply agreements is vital to unlock untapped southern African gas reserves. Upstream investment as well as investment in transmission and distribution networks are crucial to enable gas to power but require coordination between various parties, including industry and government.

“In the short term, completion of current wind and solar projects will add additional capacity to the grid, through the Renewable Energy Independent Power Producer Procurement Programme as well as distributed installations,” she explains.

“This must be managed within the existing grid’s ability to sustain the associated intermittencies. In addition, this phase will be key in preparing for future scaling of renewables, which requires planning for grid modernisation and additional pumped storage and battery storage, all of which require investment and lengthy implementation timelines of up to 10 years,” adds Reddy.

In addition to renewables, preparation for future nuclear capacity expansion must begin in this phase, including the development of a long-term strategy for nuclear generation that considers the use of conventional versus small modular reactors, securing the associated funding, and obtaining the necessary regulatory approvals.

As existing, aging coal-fired power stations begin to reach their end of life, they can be repurposed to generate cleaner energy, allowing for substantial portions of existing generation capacity to be maintained to meet immediate energy needs while transitioning to cleaner energy. This further allows for the safeguarding of existing jobs, supporting the just transition.

Phase 2: Scale up

The Kearney white paper explains that with the groundwork for grid modernisation laid in Phase 1, this (second) phase focuses on rapidly scaling renewables and clean energy.

“This includes central installations, complemented by energy storage solutions to enable a stable electricity supply, as planned under Phase 1, as well as increasing the number of distributed renewable energy resources to maximise energy access for the unconnected rural populations,” says Reddy.

Igor Hulak, Partner and Global Lead of Metals and Mining at Kearney.  

The decentralised approach not only provides energy access to remote and underserved populations, but it also reduces reliance on long-distance transmission, potentially alleviating congestion and reducing energy losses. It also creates favourable opportunities for deploying locally available renewables.

Future-forward technologies, such as green hydrogen, can play an increasing role in South Africa’s future mix. Hydrogen serves as an energy source and an energy carrier, bolstering energy security.

Looking ahead, discussions at the Africa Energy Indaba 2025 this week are exploring Africa’s path to energy security. “Gas has the potential to be a key enabler of a just energy transition, meeting Africa’s immediate energy needs while driving long-term sustainability,” says Reddy. “Through collaboration and innovation, Africa can harness its energy potential to fuel economic growth and unlock a prosperous, sustainable future,” Reddy concludes.

Kearney’s Prashaen Reddy, Igor Hulak and Frances Phillips, are sharing their expertise and insights on the African energy sector at the Africa Energy Indaba at CTICC this week in Cape Town, from 4 to 6 March 2025.

Source: supplied by Kearney