Green Cape 2040: Towards a smarter grid

The document warns that increasing residential solar PV adoption in the Western Cape will likely lead to significant municipal revenue losses, as high-income consumers reduce their reliance on the grid. Using the International Futures (IFs) model, the authors project that under a 'Current Path' scenario, the province could lose nearly 11% of municipal revenue cumulatively by 2040. To counter this, the brief proposes a sequential policy approach: short-term investment in Advanced Metering Infrastructure (AMI) to gather data, medium-term implementation of feed-in tariffs (FIT) and Time of Use (ToU) tariffs to reclaim revenue, and long-term strategic investment in a 'smart grid' and the local PV manufacturing industry. The 'Embrace and Enhance' scenario, which combines high levels of smart infrastructure investment with local manufacturing and ICT spillovers, is forecast to result in the lowest cumulative revenue losses, although it still does not fully offset the impact of decentralized energy production.

• Residential solar PV uptake is forecast to cause significant municipal revenue losses in the Western Cape, reaching an annual high of 23% by 2040 compared to a base case, with a cumulative loss of almost 11% of municipal revenue in the 'Current Path' scenario.
• The authors project that by 2040, 671,000 households in the Western Cape will have PV systems, representing 31% of all household connections in the province.
• Investment in Advanced Metering Infrastructure (AMI) is recommended as a critical first step to provide the data necessary for informed decision-making and to enable the implementation of feed-in tariffs (FIT) and Time of Use (ToU) tariffs.
• The 'React and Recharge' scenario, which involves investing in AMI and implementing a Net FIT where the municipality buys electricity from private producers at 50% of the resale price, could reduce cumulative revenue losses to R870 billion by 2040, a 12% decrease from the 'Current Path'.
• The 'Embrace and Enhance' scenario, featuring high investment in smart grids, ICT, and a local PV manufacturing sector, results in the lowest cumulative revenue losses (R582 billion), though the province would still lose 6.5% of cumulative revenue by 2040.
• A local residential PV industry could contribute a cumulative R217 billion to the Western Cape by 2040, assuming a localisation factor of 36% of installation costs are kept within the province.
• The 'Runaway Loss' scenario demonstrates that implementing feed-in tariffs and AMI without corresponding investments in grid efficiency and effective administration can lead to greater revenue losses than the 'Current Path'.
• South Africa's electricity supply is under severe pressure, with total electricity available for distribution peaking in 2011 and declining to 233,105 GWh in 2013, while demand is projected to reach 345,000–416,000 GWh by 2030.

APA

Camp, H., Hedden, S., Bohl, D., Petersen, A.-I., & Moyer, J. D. (n.d.). Green Cape 2040: Towards a smarter grid. Institute for Security Studies. https://issafrica.s3.amazonaws.com/site/uploads/PolBrief-FuturesCape-4.pdf

Chicago

Camp, Hanna, Steve Hedden, David Bohl, Aa-ishah Petersen, and Jonathan D Moyer. Green Cape 2040: Towards a smarter grid. Institute for Security Studies, n.d. https://issafrica.s3.amazonaws.com/site/uploads/PolBrief-FuturesCape-4.pdf.

Wikipedia

{{cite report |last1=Camp |first1=Hanna |last2=Hedden |first2=Steve |last3=Bohl |first3=David |last4=Petersen |first4=Aa-ishah |last5=Moyer |first5=Jonathan D |title=Green Cape 2040: Towards a smarter grid |publisher=Institute for Security Studies |url=https://issafrica.s3.amazonaws.com/site/uploads/PolBrief-FuturesCape-4.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{campndgreen, author = {Camp, Hanna and Hedden, Steve and Bohl, David and Petersen, Aa-ishah and Moyer, Jonathan D}, title = {{Green Cape 2040: Towards a smarter grid}}, institution = {Institute for Security Studies}, url = {https://issafrica.s3.amazonaws.com/site/uploads/PolBrief-FuturesCape-4.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }