South Africa has made significant progress in developing its renewable energy sector over the past decade, with a focus on wind and solar power. The energy sector in South Africa is at the center of the economy due to the country’s high energy intensity.South Africa has a well-developed electricity network and one of the highest rates of electricity access in sub-Saharan Africa (IEA, 2020). In both urban and rural areas, electricity is the favorite option for cooking, and the country also relies on oil and gas for its energy needs. The share of renewable energy in the total final energy consumption in South Africa was forecasted to continuously increase between 2023 and 2028 by in total 0.7 percent points. The share of renewable energy is estimated to amount to 19.14 percent in 2028.
As of 2021, the total renewable energy capacity in South Africa amounted to 10,193 MW.
Overall, while there is still progressed to be made, South Africa has made significant strides in developing its renewable energy sector over the past decade. The government’s commitment to increasing the share of renewable energy in the electricity mix and the success of the REIPPPP have helped to drive investment and create jobs in the sector.
Currently, the demand for hydrogen and green hydrogen in South Africa is relatively low compared to other countries, but there are efforts to increase the use of hydrogen in various sectors.
According to a report by the International Energy Agency, South Africa's total hydrogen demand was approximately 0.5 MTPA in 2019, with most of this demand coming from the oil refining and chemical industries. However, the report also notes that there is potential for increased demand for hydrogen in the transport sector as well as in power generation. South Africa has significant potential for producing green hydrogen using renewable energy sources such as wind and solar power. According to the Hydrogen Society Roadmap, the country could produce up to 3.9 million tonnes of green hydrogen per year by 2050.
South Africa currently produces hydrogen mainly from fossil fuels, primarily through the steam methane reforming process. According to the South African National Energy Development Institute, the country produced approximately 450,000 tonnes of hydrogen in 2018, with most of this used for industrial processes.
South Africa has a small but growing market for hydrogen fuel cell vehicles. According to the Department of Trade, Industry and Competition, there were approximately 30 hydrogen fuel cell vehicles registered in the country as of 2020, and there are plans to increase this number in the coming years.
Overall, while the demand for hydrogen and green hydrogen in South Africa is currently relatively low, there is potential for increased use of hydrogen in various sectors, particularly in transport and power generation. The country's abundant renewable energy resources and existing expertise in related industries make it well-positioned to become a leader in the development of green hydrogen technologies.
The South African government has developed policies and initiatives to promote the development of a hydrogen and green hydrogen economy. Here are some key policies related to hydrogen and green hydrogen in South Africa:
Overall, the South African government has shown a commitment to developing a hydrogen and green hydrogen economy, as evidenced by the Hydrogen Society Roadmap and other policies and initiatives. The government's focus on research and development, as well as its support for the renewable energy sector, make it well-positioned to become a leader in the development of hydrogen and green hydrogen technologies.
p>The government also relies on global partnerships and foreign investments to kick-start its hydrogen production. It is currently developing its first Country Investment Strategy (CIS) (1), aiming to attract more foreign and domestic direct investment into the country. In January 2022, the government announced a new collaboration (2) with the German Ministry of Economic Cooperation and Development (BMZ) to launch a new project that will promote green hydrogen production in South Africa. BMZ will provide €12.5 million in funding to support the project, which aims to produce a strategic and regulatory framework for the green hydrogen economy in South Africa, coordinate the contribution of different stakeholders, and ensure high environmental standards.
The regulatory framework for hydrogen and green hydrogen in South Africa includes a range of policies and regulations governing the production, distribution, storage, and use of these fuels. Here are some key elements of the regulatory framework for hydrogen and green hydrogen in South Africa:
Overall, the regulatory framework for hydrogen and green hydrogen in South Africa provides a comprehensive set of policies and regulations aimed at promoting the safe and sustainable production, distribution, and use of these fuels. The framework is continually evolving to keep pace with new technologies and developments in the industry.
South Africa has several assets in pursuing its hydrogen ambitions: deep expertise in the Fischer-Tropsch process (which is used in the production of power fuels), major production capacity of critical minerals necessary for hydrogen, and infrastructure that could be used for the hydrogen. The country is the world's largest producer of PGMs (platinum group metals), one of the key ingredients in the production of green hydrogen, yet platinum currently contributes very little to its GDP because most of the raw materials are exported. In fact, the Platinum Valley Initiative (PVI) is one of the four catalytic projects identified in the strategy document to kick-start the country’s hydrogen economy.
South Africa’s abundant renewable resources offer another advantage. A recent report by the National Business Initiative says that South Africa could produce green hydrogen for USD 1.60 per kg by 2030, one of the lowest costs worldwide. This could help the country reach its goal of doubling its current share of global hydrogen production by 2050—from 2 to 4 percent.
Here are some key infrastructure developments related to hydrogen and green hydrogen in South Africa:
List of projects:
Overall, these projects demonstrate the growing interest in hydrogen and green hydrogen in South Africa and the potential for these fuels to play a role in the country's transition to a low-carbon economy.