KOTRA Report Presents 'How Korean Companies Can Enter the South African Power Market'

by Choi Seoyoon

Published 31 Dec.2024 06:00(KST)

Containing Strategies for Expansion into Six African Countries and Key Company Information

The Ministry of Trade, Industry and Energy and KOTRA announced on the 31st that they will publish the report "Strategy for Entering the Southern Africa Power Market" on January 2nd next year.

The report provides an in-depth analysis of power generation and demand, energy policies, and trends of major Engineering, Procurement, and Construction (EPC) companies in South Africa and neighboring countries, proposing an entry strategy focused on renewable energy projects.

South Africa has the most developed power infrastructure in Sub-Saharan Africa (SSA), but power shortages remain severe. The total generation capacity is 53.9 GW, and the generated electricity amounts to 211.4 TWh. The country is working to expand the share of renewable energy to move away from a coal-centered power structure. Through the Energy Action Plan and the Independent Power Producer Procurement Program (IPP), it aims to stabilize the power grid and achieve decarbonization. Accordingly, imports of renewable energy equipment have continuously increased, reaching a record high last year.

KOTRA Report Presents 'How Korean Companies Can Enter the South African Power Market'

According to the report, neighboring countries around South Africa are also promoting renewable energy projects to compensate for their poor power infrastructure. Namibia is expanding renewable energy projects; Madagascar aims to achieve an 80% share of renewable energy by 2030; Botswana plans a 15% increase during the same period; Zambia aims to double its power capacity; and Zimbabwe targets an additional supply of 2,300 MW by next year.

KOTRA analyzed power market opportunities in six African countries and emphasized that Korean companies should leverage their advanced technology and project experience to establish cooperative models with local governments and EPC companies. It also suggested formulating entry strategies focused on promising sectors such as solar power, wind power, energy storage systems, and smart grids, and strengthening competitiveness through technology transfer and equipment supply utilizing policy funds.

Kim Myung-hee, head of KOTRA's Africa Regional Headquarters, said, "The power market in South Africa and neighboring Southern African countries will provide significant opportunities for Korean companies alongside the increasing demand for renewable energy. KOTRA will do its best to share and disseminate market opportunities so that our companies can enter the market with customized strategies utilizing advanced technologies."