The winds of change: Why wind power will lead South Africa’s renewable future

South Africa’s wind energy sector is no longer speculative. It is investable, liquid and accelerating according to Zaahid Ganey, Investment Director at African Infrastructure Investment Managers (AIIM).

If you have driven through the Eastern, Western or Northern Cape recently, you may have seen convoys of trucks transporting massive wind turbine blades. They are difficult to miss; long, narrow and striking against the red Karoo dust. For many, these vehicles are just another road delay. For us, they are a signal that the centre of gravity in South Africa’s energy system is shifting.

Wind energy is scaling up. Quietly, consistently and with far less fanfare than solar, it is becoming the most important contributor to our future electricity mix. Based on the 2025 Integrated Resource Plan, South Africa’s installed wind capacity is anticipated to grow from around 4 gigawatts today to 34 gigawatts by 2039. That is almost nine times increase over the next 14 years, which compared to solar is expected to increase by four times over the same period.

Why Wind Works — Technically and Economically

Wind’s contribution to system reliability is often underappreciated. Unlike solar, which is limited to daylight hours, wind can generate during peak demand periods in the early mornings and evenings. Wind also has a higher capacity factor of between 35-45% as opposed to solar at 20-30%. These factors make it an ideal partner in a mixed technology portfolio.

From an economic perspective, wind is attractive. In regions with strong wind resources, such as the Northern, Eastern and Western Cape, wind projects offer strong generation profiles at low marginal cost. Larger wind turbine sizes also contribute to cost efficiency with lower land use and simpler logistics. While comparably construction and logistics are more complex than solar, wind is still one of the most cost-effective source of new bulk electricity generation in South Africa today.

Of course, cost-efficiency is only part of the equation. Wind can also be more variable than solar, which makes thoughtful portfolio design essential. We manage this by investing in both technologies. The portfolio effect allows us to hedge performance risk across seasons, technologies and geographies. As a long-term investor, we are not interested in chasing trends but rather technologies that will last for the long term.

What the Private Sector is Getting Right

The commercial and industrial (C&I) market is now leading South Africa’s energy investment cycle. Over the past two years, AIIM has closed more than 660 megawatts of wind projects in the C&I space, including Castle Wind Farm, which supplies Sibanye Stillwater and the 420 megawatt Northern Cluster with off takers such as Rio Tinto and Net Zero Africa.

While REIPPPP has delivered roughly 9 gigawatts over 15 years, the private market has achieved over 5.8 gigawatts in just 2.5 years. This is a signal that institutional capital is ready to move and that market-led solutions are working.

We also need to be honest about the factors that held the sector back. Bid Windows 5, 6 and 7 were delayed by grid constraints and transmission bottlenecks, which are challenges that are not unique to South Africa. From India to Brazil and across parts of Europe, transmission has become the key bottleneck in renewable deployment. These are not abstract problems. They are real, system-level barriers to getting projects over the line.

That is why the Independent Transmission Programme (ITP) is the most important energy reform on the table right now. Its structure, where private parties build, operate and then transfer lines to the state, is pragmatic and replicable. Phase 1 includes seven corridors and over 1,000 kilometres of lines. Government’s commitment to 14,000 kilometres over the next decade is necessary, encouraging and positive to unlocking further wind development.

The Exit That Signals a Market Maturing

While the ITP will shape the next wave of growth, it is worth remembering that REIPPPP laid the foundation for South Africa’s utility-scale renewable energy market. We are now seeing that early promise translate into full investment cycles, moving from construction through to exit and reinvestment.

In August, our IDEAS Fund exited three long-held REIPPPP projects, including the Jeffreys Bay Wind Farm and two solar PV plants in the Northern Cape. The transaction, completed with Gaia Renewables, Enzani and Usizo for greater than R750 million signals that these assets are not only operational but also tradeable and in demand.

This is what a maturing market looks like. The ability to exit and recycle capital gives shareholder’s headroom to re-invest in new opportunities.

What Still Needs to Change

To unlock the full potential of wind, we need to accelerate market reforms that enable more flexible contracting, including wheeling, trading and multi-buyer arrangements. The next wave of wind projects will be distributed and built by many developers across the country, linked by a modern, responsive grid.

In short, we are not short of capital. We are short of coordination. The private sector is ready. The policy signals are improving. What we now need is follow-through.

South Africa’s wind sector is no longer speculative. It is proven, investable and increasingly liquid. We are not simply imagining a wind-powered future. We are building it, project by project, corridor by corridor. The blades on our highways are not symbols of potential, but signs of tangible delivery.